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Spreadsheets have lots of strengths. I believe one of the difficulties is (a) managing an increasingly large number of transactions over time, with (b) an uncer

Spreadsheets have lots of strengths. I believe one of the difficulties is (a) managing an increasingly large number of transactions over time, with (b) an uncertain number of postings to (c) arbitrary accounts in a hierarchy. Though I haven't tried myself, I suspect modelling a full double-entry-bookkeeping General Journal in a spreadsheet just gets cumbersome. Secondly, while certain kinds of calculations and queries are easier in a spreadsheet, other kinds of queries and ad hoc reports are easier with PTA tools. Thirdly (big one), the plain text format lends itself to version control (good for data integrity and auditing), scripting and integration, and future-proofness. An example of Ledger/hledger's main file format: 2021-01-01 opening balances on january 1st assets:checking $1000 ; a posting, increasing assets:checking's balance by $1000 assets:cash $100 liabilities $0 equity $-1100 ; each transaction must sum to zero 2021-03-05 client payment assets:checking $2000 revenues:consulting $-2000 ; revenues/liabilities/equity normally appear negative 2021-03-20 Sprouts expenses:food:groceries $100 assets:cash $40 assets:checking ; a missing amount will be inferred ($-140 here)

account-5 5y ago
I suppose the biggest barrier for me would be learning double entry bookkeeping as I'm not doing that just now. I wouldn't know where to start. Currently the above makes no sense to me.
- hiq 5y ago
  I'm not that familiar with the theory, in my case I just got started and now I'm used to it. Just to take the last example: 2021-03-20 Sprouts expenses:food:groceries $100 assets:cash $40 assets:checking This means you took 140 from your checking account, withdrew 40 that you now have in cash, and spent 100 in groceries. Does that still make no sense?
  - account-5 5y ago
    Honestly no. When I first read it I thought you'd spent 140 on sprouts which I thought was excessive, but each to their own. Even though you've explained it I'm still struggling to make sense of it. The 3 indented lines don't related at all in an intuitive manner at least for me.
    - chromatin 5y ago
      Understandable, they are using transaction balancing / elision What they should be showing beginners is: 2021-03-20 Sprouts expenses:food:groceries $100 assets:cash $40 assets:checking $-140 How’s that?
    - bokstavkjeks 5y ago
      I don't think the file format above is especially conductive to learning. In my experience, most people learn double-entry bookkeeping with T accounts; debit is on the left, credit is on the right, and total credit has to equal total debit. If you're interested, this seems like a fairly decent guide: https://www.open.edu/openlearn/money-business/introduction-bookkeeping-and-accounting/content-section-2.5 https://www.open.edu/openlearn/money-business/introduction-b...
    - cagey 5y ago
      A possible source of confusion is that in this context, "Sprouts" is likely the name of a supermarket (not a type of food).
- shubhamkrm 5y ago
  I found the GNUCash manual to be an excellent introduction to double entry accounting for people with no accounting background. Even my ledger accounts are setup in the same way.
- Jtsummers 5y ago
  The syntax above can be learned easily enough, but double-entry boils down to: Each transaction shows both where money goes and where it comes from, the sum should be 0. Where it goes and comes from are "accounts", which may or may not correlate to actual accounts like you might think of in personal finance. There are 3 categories of accounts: expenses, assets, liabilities. You own the second two, they are your cash, checking, savings, brokerage as assets and your mortgage, car loan, CCs as liabilities. Expenses are where you spend money outside of your own accounts. Before getting to expenses, you may have accounts like this for your assets and liabilities: assets:cash $100 assets:checking $2000 liabilities:cc $-100 liabilities:car $-10000 Whenever you transact your money goes from one place to another, so a car payment may look like: 2021-09-05 Car Payment assets:checking $-500 liabilities:car $500 Positive means that that account gets the money, negative it loses the money. Note that it sums to $0. If there were an interest component we may do this: 2021-09-05 Car Payment assets:checking $-500 liabilities:car $400 expenses:interest $100 Expenses are not owned by you. They can be broad categories or more specific. Maybe you have two residences and utilities at both: expenses:primary:electric:edison:1234 -- your account number expenses:secondary:electric:pandg:1234 I wouldn't go that far, I might do: expenses:house:electric:primary expenses:house:electric:secondary But the choice is up to you, both work. Think of them as hierarchical tags.
smichael 5y ago
Another advantage over spreadsheets I forgot: more guide rails and more common ground (shared practices, howtos, support) with other users. Spreadsheets are a tabular report construction kit, PTA is an accounting system construction kit.

account-5 5y ago

I suppose the biggest barrier for me would be learning double entry bookkeeping as I'm not doing that just now. I wouldn't know where to start. Currently the above makes no sense to me.

hiq 5y ago
I'm not that familiar with the theory, in my case I just got started and now I'm used to it. Just to take the last example: 2021-03-20 Sprouts expenses:food:groceries $100 assets:cash $40 assets:checking This means you took 140 from your checking account, withdrew 40 that you now have in cash, and spent 100 in groceries. Does that still make no sense?
- account-5 5y ago
  Honestly no. When I first read it I thought you'd spent 140 on sprouts which I thought was excessive, but each to their own. Even though you've explained it I'm still struggling to make sense of it. The 3 indented lines don't related at all in an intuitive manner at least for me.
  - chromatin 5y ago
    Understandable, they are using transaction balancing / elision What they should be showing beginners is: 2021-03-20 Sprouts expenses:food:groceries $100 assets:cash $40 assets:checking $-140 How’s that?
  - bokstavkjeks 5y ago
    I don't think the file format above is especially conductive to learning. In my experience, most people learn double-entry bookkeeping with T accounts; debit is on the left, credit is on the right, and total credit has to equal total debit. If you're interested, this seems like a fairly decent guide: https://www.open.edu/openlearn/money-business/introduction-bookkeeping-and-accounting/content-section-2.5 https://www.open.edu/openlearn/money-business/introduction-b...
  - cagey 5y ago
    A possible source of confusion is that in this context, "Sprouts" is likely the name of a supermarket (not a type of food).
shubhamkrm 5y ago
I found the GNUCash manual to be an excellent introduction to double entry accounting for people with no accounting background. Even my ledger accounts are setup in the same way.
Jtsummers 5y ago
The syntax above can be learned easily enough, but double-entry boils down to: Each transaction shows both where money goes and where it comes from, the sum should be 0. Where it goes and comes from are "accounts", which may or may not correlate to actual accounts like you might think of in personal finance. There are 3 categories of accounts: expenses, assets, liabilities. You own the second two, they are your cash, checking, savings, brokerage as assets and your mortgage, car loan, CCs as liabilities. Expenses are where you spend money outside of your own accounts. Before getting to expenses, you may have accounts like this for your assets and liabilities: assets:cash $100 assets:checking $2000 liabilities:cc $-100 liabilities:car $-10000 Whenever you transact your money goes from one place to another, so a car payment may look like: 2021-09-05 Car Payment assets:checking $-500 liabilities:car $500 Positive means that that account gets the money, negative it loses the money. Note that it sums to $0. If there were an interest component we may do this: 2021-09-05 Car Payment assets:checking $-500 liabilities:car $400 expenses:interest $100 Expenses are not owned by you. They can be broad categories or more specific. Maybe you have two residences and utilities at both: expenses:primary:electric:edison:1234 -- your account number expenses:secondary:electric:pandg:1234 I wouldn't go that far, I might do: expenses:house:electric:primary expenses:house:electric:secondary But the choice is up to you, both work. Think of them as hierarchical tags.

smichael 5y ago

Another advantage over spreadsheets I forgot: more guide rails and more common ground (shared practices, howtos, support) with other users. Spreadsheets are a tabular report construction kit, PTA is an accounting system construction kit.