LeoGlossary: Double-Entry Accounting (Bookkeeping)

An accounting principle whereby for each credit/debit entry made in one account, there is a corresponding entry in another account.

Luca Pacioli is credited with discovering this in 1494.

This introduced the liability to the balance sheet. Once this was done, the tracking of who owed what to whom was possible. This changed the nature of business as well as money since credit could not be extended. It was a concept that was the foundation for the growth of the powerful European banks during the Dutch Age.

Blockchain is considered revolutionary by many since it takes what Pacioli discovered and moves it one step further. Many claim that blockchain introduced us to triple-entry accounting.

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