Accounting Fundamentals

How the books actually work, and how software makes them work.

Every financial statement you have ever read was derived from a list of journal entries. This course starts at that list, builds up to the statements, and shows you the machinery underneath: the state machines, the immutability rules, and the derivation logic that a real accounting system runs on.

What you will be able to do

• Explain why double-entry exists and what invariant it protects
• Design a chart of accounts that produces the reports a business needs
• Trace a transaction from source document to journal entry to financial statement
• Say precisely why posted entries are never edited, and what to do instead
• Read a trial balance and derive the P&L and balance sheet from it by hand
• Reason about how accounting software is engineered and judge whether a system is trustworthy

Syllabus

1. Module 1

   Why double-entry exists

   The single idea the entire discipline is built on, and the invariant it protects.

   • Every transaction moves value twiceWhy one-sided records cannot be checked, and how duality makes errors visible.12m
   • Debits and credits are directions, not judgementsDropping the good/bad intuition and reading debit and credit as positions on an account.14m
   • Double-entry check6 questions · 70% to pass

2. Module 2

   Designing the chart of accounts

   The five account types, why numbering exists, and how today's COA decides which questions you can answer next year.

   • The five account typesAssets, liabilities, equity, income, expenses: and why there are exactly five.12m
   • Design for the report you will needWhy account granularity is a reporting decision, and the cost of getting it wrong.13m
   • Chart of accounts check6 questions · 70% to pass

3. Module 3

   The journal entry lifecycle

   An entry is not a row you insert; it is a state machine that ends in an irreversible commitment.

   • Draft to posted, and the door that locksThe five states an entry moves through, and why posting is the point of no return.15m
   • Lifecycle check6 questions · 70% to pass

4. Module 4

   The immutable ledger

   Why a posted entry is never edited, and why that constraint is a feature.

   • Why you cannot just fix itWhat editing history destroys, and what reversal preserves.14m
   • Immutability check6 questions · 70% to pass

5. Module 5

   Subledgers: invoices, bills, and the GL

   How documents you actually work with become the entries the ledger stores.

   • Receivables and payables as subledgersWhy 'who owes me' lives beside the GL rather than inside it.15m
   • Subledger check6 questions · 70% to pass

6. Module 6

   Trial balance to financial statements

   The payoff: statements are pure functions over posted entries, and you can compute them by hand.

   • The trial balance is a checkpoint, not a reportWhat it proves, what it cannot prove, and why it comes first.13m
   • Deriving the P&L and balance sheetSplitting the trial balance into two statements that meet at net income.16m
   • Derivation check6 questions · 70% to pass

7. Module 7

   Period close and year-end

   How a continuous stream of entries gets cut into reportable periods.

   • Closing the booksCutoffs, closing entries, and why last year's profit becomes this year's equity.15m
   • Close check6 questions · 70% to pass

8. Module 8

   Multi-currency basics

   What happens to the accounting equation when value is measured in two units at once.

   • Transaction currency versus base currencyWhy every foreign transaction is recorded twice over, and where FX gains come from.16m
   • Currency check6 questions · 70% to pass