Journal Entries

The journal voucher is the accountant's free-form tool: any debits, any credits, as long as they balance. That freedom is exactly why it deserves its own page — every messy ledger in history is a stack of undocumented journal entries.

Legitimate uses#

• Corrections — an expense posted to the wrong head, moved to the right one.
• Accruals — recording an expense in the period it belongs to before the invoice arrives, and reversing when it does.
• Reclassifications — restructuring balances when the chart of accounts evolves.
• Prior-period corrections — made in the current period with a narration referencing what they fix, because closed financial years don't reopen.

The narration rule#

A journal entry without a narration is a future argument. Write it so a stranger — or you, in eleven months — can reconstruct the story: what was wrong, where it came from, why this entry fixes it. "Correction of EXV-231: generator fuel posted to Utilities—Electricity, moved to Fuel."

What a journal entry is NOT for#

• Not for cash movements — that's a debit/credit/contra voucher, which carries the cash context reports rely on.
• Not for overriding operations. If sales, consumption or settlements look wrong, the fix is in the operation (or a support repair), never a JV painted over the symptom — the operation's reports and the ledger would then disagree forever.
• Not for balancing away a difference you don't understand. An unexplained difference is information; a JV that hides it is a deleted clue.

Journal entries go through the approval chain like any manual voucher — and they're the type your approvers should read most carefully.