what double entry bookkeeping

Double-entry bookkeeping is an accounting method that ensures every financial transaction is recorded in at least two accounts: one as a debit and the other as a credit. This system maintains the accounting equation (Assets = Liabilities + Equity) and helps ensure the accuracy of financial records. Each transaction impacts both sides of the balance sheet, providing a clear and balanced view of a business’s financial health. Double-entry bookkeeping helps prevent errors, detect fraud, and provides the foundation for generating reliable financial statements, making it a fundamental practice for businesses of all sizes.