What is double-entry bookkeeping used for

Amount of assets on balance sheet is equal to amount of liabilities, debit is equal to credit. This is the basic principle of accounting, therefore any transaction must be registered twice: as income and as expense. In order for one transaction to be reflected simultaneously in debit and in credit accounts, the double-entry bookkeeping is used.

This method provides general balance sheet, correlation of accounts and controllability and reflects the basic principles of accounting: continuity, completeness and timeliness.

  • Continuity – accounting throughout the entire period of the organization's activity.
  • Completeness – registration of all economic life events without omissions.
  • Timeliness – reflection of transactions in accounts at the time of their commission or immediately after.


Debit account and credit account on which the transactions are reflected have their own encodings. In order to decode them, a Chart of accounts (COA) is made - a scheme for registering and grouping assets, liabilities, financial and economic transactions.

In cases when accounts register any property belonging to enterprises, they are called asset accounts. These are accounts used to reflect fixed assets, materials, cash, goods, finished products, expenses, etc.

Liability accounts reflect sources of companies' funds. These accounts include authorized, reserve and additional capital, as well as loans.

In addition, asset-liability accounts are used, which then are divided into:

  • accounts that include credit balance and debit balance simultaneously. These are accounts where payments to suppliers, customers, personnel, budget, etc. are reflected;
  • accounts that include either asset balance or liability balance. First of all, these include accounts of financial results.

The current Chart of accounts and instructions for its application are approved by the Order of the Ministry of Finance of the Russian Federation No. 94n dated 31.10.2000.

All types of companies with some exceptions are obliged to apply COA.


Double-entry bookkeeping does not apply to off-balance sheet accounts, where property that does not belong to the organization or assets and liabilities that are not accounted for on the balance sheet are reflected. In this case, the account reflects only registration or de-registration.

Micro-enterprises and non-forprofit organizations that have the right to use simplified accounting methods and submit simplified financial statements, as well as sole entrepreneurs who do not use COA, can refuse to use the double entry bookkeeping.

Specialized Charts have been developed for credit institutions and budget institutions that reflect the specifics of their activities.

Changes in legislation

The Federal Law dated December 31, 2021 No. 435-FL has amended the Laws “On accounting” and “On auditing” concerning the procedure of entering the data into the State Information Resource of Financial Accounts (GIRBO) and access to them.

In particular:

  • the restrictions were put on the list of cases of exemption from reporting established by the Government of Russia;
  • the powers of the Government of Russia were specified in relation to the determination of limited access to the data in GIRBO. It is referred to the cases when only state authorities, local government bodies, state non-budgetary funds and the Central bank of Russia have access to these data;
  • the mandatory soft copy of the reports must be submitted within 3 months following the end of the reporting period;
  • in case of provision the repot being subject to the mandatory audit, the soft copy of the audit report must be provided either along with the financial accounts or within 10 working days from the day following the date of the audit report, but no later than December 31 of the year following the reporting year;
  • the common term was specified for providing the corrected reports – no later than July 31 of the year following the reporting year. If the report is approved after that date and is different from the previously provided one, it must be submitted to GIRBO within 10 working days from the day following the day of approval of the reporting, but no later than December 31 of the year following the reporting one;
  • зthe delivery of information contained in GIRBO is subject to a charge at the amount and the procedure determined by the Government of Russia.

The subscribers of Globas have an option to get acquainted and analyze the accounting reports (including the archived once traced back to 1997) of all legal entities of the Russian Federation that have submitted them to the Federal State Statistics Service and the Federal Tax Service.