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Definition
A journal entry is a manual accounting record that adjusts the ledgers, with equal debit and credit sides. It is used for corrections, accruals, prepayments, depreciation and other adjustments not captured by routine transactions.
In plain terms
Most transactions post automatically, but some — like recording depreciation or accruing a cost — need a deliberate entry. A journal is that entry, always balancing debits against credits under double-entry.
Why it matters for your company
Journals are where accruals, prepayments and depreciation get into the accounts, so they matter for accurate matching. They are also where errors and, occasionally, manipulation hide — so auditors scrutinise unusual journals closely.
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