In a business which mainly uses clerical systems of bookkeeping Loose Leaf Ledgers and Card Ledgers, it is now common to substitute this for bound books. A Loose Leaf Ledger consists of an expanding binder into which is inserted separate sheets printed in Ledger ruling. Card Ledgers consist of similarly printed cards which are kept in trays or drawers arranged in cabinets.
Such systems are also common among firms using the simpler forms of mechanized accounts. The advantages of these forms over the ordinary bound book are that the ‘dead’ accounts may be removed and kept separately. The binder or drawer then contains only the ‘live’ accounts and sheets or cards can be added as new accounts as the need arise. This avoids the work of opening a new Ledger as the old bound Ledger is filled. Further, as the sheets or cards are loose the accounts may be arranged alphabetically, rendering a separate index unnecessary.
In times of pressure as for example, when the monthly statements of account have to be prepared, loose leaf or card systems make for faster and more convenient methods of work, as they may be used by a number of clerks each taking a number of accounts. This saves time in ordinary posting, since the accounts are continues as the leaf or card is filled a new one is added next to it. In the bound Ledger an estimate has to be made of the space to be allotted to an account and if this proves insufficient, the account is continued in another place.
The disadvantage of the Loose Leaf and Card Ledger has been that leaves or cards may be willfully destroyed or substituted or fresh cards inserted for fraudulent purposes. But this can be largely overcome by the introduction of safety locking devices and by instituting control of the issue of blank leaves or cards, allied to a well-planned system of division of duties.
The development of systems using punched card machines in which all the details of a particular transaction are kept in a punched card, led to yet different ways of maintaining records. Although Ledger Accounts are normally printed out in such systems this is not technically necessary, as long as the punched cards can be filed in appropriate categories and readily re-sorted into different categories.
Early computer systems also used punched cards, but these have now been replaced in many cases by the storage of information in other forms, such as on magnetic tapes and discs. With modern equipment it is possible to gain access to any desired item of information, regardless of the order in which the data is recorded in the system. This reduces the need for written records and represents a significant advance in the ways of maintaining the Ledger Accounts. Nevertheless, the basic double-entry principles are unchanged.
All these variations in form have their uses. They are introduced to meet the needs of particular types of businesses and in every case the purpose is to facilitate the recording in order that it may keep pace with the volume of the business. The principles of bookkeeping remain constant — it is only the method of the recording medium has changed to meet new conditions.
Tags: accounts, bookkeeping, bound books, business, card ledgers, computer systems, loose leaf ledgers, machines