Midaz provides a modern accounting foundation designed for real-time financial systems. It combines the robustness of traditional double-entry bookkeeping with the flexibility required for digital products, embedded finance, and high-volume operations. This page introduces the core accounting principles inside Midaz, how its primitives map to standard accounting practices, and how you can design a complete chart of accounts using the platform. Midaz is intentionally ledger-centric: every balance, movement, posting, and reconciliation is enforced at the ledger level—offering traceability, auditability, and consistency by default.

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1. Core accounting concepts in Midaz

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Before diving into how Midaz implements accounting, it helps to revisit how accounting works conceptually in any financial system.

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Double-Entry accounting

Midaz is built on strict double-entry rules:

• Every transaction must have at least one debit and one credit.
• Total debits must equal total credits.
• Every movement impacts the ledger in a balanced way.

This ensures:

• No drift in balances
• Precise audit trails
• Regulation-ready financial statements

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Chart of Accounts

In traditional accounting, the Chart of Accounts (CoA) defines:

• Account categories (Assets, Liabilities, Equity, Income, Expenses)
• Hierarchies
• How movements are classified

Midaz provides tools so your product can mirror or adapt this structure digitally.

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Accounting events & postings

Every change in value generates an event that contains:

• What happened
• Which accounts were affected
• How much was moved
• Metadata for audit and compliance

Midaz translates business actions (“cash-out”, “fee”, “capture”, “settlement”) into structured accounting postings.

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2. How Midaz implements accounting

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Midaz implements accounting using a set of flexible primitives:

• Assets
• Account Types
• Accounts
• Segments
• Portfolios
• Operation Routes
• Transaction Routes
• Transactions

Together, they form a programmable accounting engine.

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Assets

An asset defines what is being moved:

• Currencies (BRL, USD, EUR)
• Points or miles
• Crypto tokens
• Internal units of value (credits, balance tokens)

Assets define:

• Decimal precision
• Regulatory metadata
• Operational formatting

Midaz enforces asset consistency across all postings.

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Account types

Account Types represent templates for the accounts in your ledger. Examples:

• CASH
• CUSTOMER_FUNDS
• FEES
• RESERVES
• TREASURY
• RECEIVABLES

Each type defines how accounts behave in terms of:

• Allowed operations
• Association with entities or portfolios
• Internal vs external accounts
• Reconciliation rules

You can define your own account types to reflect your financial model.

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Accounts

An account represents a balance container inside the ledger. Every account belongs to:

• A portfolio
• A segment
• An account type
• An asset code

Midaz allows:

• Hierarchical accounts
• Multiple balances per account (via balance keys)
• External accounts (e.g. @external/BRL)
• Alias-based routing

This makes it possible to model anything from simple wallets to complex liquidity structures.

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Segments

Segments allow you to categorize and isolate accounts. Use cases:

• Separate customer funds from internal funds
• Manage business units
• Implement multi-tenant separation
• Track different product lines

Segments are powerful for governance and reporting.

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Portfolios

Portfolios group accounts that share a common purpose or belong to the same entity. Portfolios help you:

• Associate all customer accounts to a single portfolio
• Isolate legal entities
• Track the financial performance of a group

Midaz allows multiple portfolios per entity depending on your model.

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Operation routes

Operation Routes define the accounting logic itself. They answer the question:

“When this type of operation occurs, which accounts should be debited and credited?”

For example:

• A transfer out (cash-out)
• A deposit (cash-in)
• A fee collection
• A settlement
• A reversal

Each route describes:

• Source accounts
• Destination accounts
• Balance keys
• Ledger logic
• Validation rules

Operation Routes are the core of accounting governance in Midaz.

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Transaction routes

Transaction Routes define the business event that triggers accounting. If Operation Routes define how movements occur, Transaction Routes define when. Examples:

• PIX_CASH_OUT
• PIX_INSTANT_PAYMENT
• PIX_REFUND
• WALLET_TRANSFER
• BANK_SLIP_SETTLEMENT

Each Transaction Route maps a business action to:

• Required validations
• Operational context
• The associated Operation Routes

This gives your system both flexibility and control.

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3. Building your Chart of Accounts in Midaz

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Midaz gives you all the primitives to design a complete chart of accounts. Below is a recommended process.

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Step 1 — Map your financial model

List the types of balances needed:

• Customer balances?
• Internal accounts?
• Reserve or settlement accounts?
• Fee and revenue accounts?

This becomes your initial CoA blueprint.

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Step 2 — Define account types

For each conceptual category, create an Account Type. Example:

• CASH → liquid customer funds
• SETTLEMENT → funds awaiting clearing
• FEE_REVENUE → fees collected
• FEE_EXPENSE → provider fees
• TREASURY → internal operations

Account Types keep your ledger consistent.

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Step 3 — Create segments & portfolios

Segments separate business domains. Portfolios manage ownership and grouping. Example:

• Segment: CUSTOMER_FUNDS
• Portfolio: customer_12345_wallet

This allows multi-product and multi-tenant architectures.

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Step 4 — Create accounts

For each logical balance, create a ledger account. Examples:

• Customer BRL account
• Corporate treasury account
• Provider fee expense account
• Merchant settlement account

Accounts are identified by alias, making routing more intuitive.

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Step 5 — Define operation routes

Operation Routes map accounting logic to real transactions. Example for a Pix cash-out:

• Debit: customer BRL account
• Credit: external BRL account (@external/BRL)

Midaz ensures:

• Balances exist
• Debits ≤ available balance
• Assets match
• Ledger stays balanced

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Step 6 — Define transaction routes

Transaction Routes represent your business operations. Each route:

• References Operation Routes
• Defines validations
• Can enforce business rules

This creates a programmable financial brain.

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4. How Midaz helps with accounting

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Midaz is designed to make accounting automatic, traceable, auditable, and extensible.

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Real-Time ledger

Every transaction:

• Updates balances instantly
• Creates immutable audit logs
• Generates metadata for reconciliation
• Ensures double-entry correctness

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Deterministic financial logic

Operation Routes and Transaction Routes prevent:

• Incorrect debits
• Drifting balances
• Unauthorized account usage
• Inconsistent postings

Your team never needs to manually handle accounting logic in code.

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Multiple balances per account

Balance Keys let you separate:

• Blocked vs available funds
• Pending vs settled amounts
• Limits
• Multi-currency overlays

Perfect for Pix, cards, and payments.

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Reversals & adjustments

Midaz supports:

• Transaction reversals
• Refunds
• Chargebacks
• Financial corrections

All with full traceability.

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Full audit trail

Every movement stores:

• Origin
• Route
• Metadata
• Parent transaction (when applicable)

Regulators love this. Your auditors will too.

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5. Typical accounting scenarios with Midaz

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Pix Cash-Out

• Customer account is debited
• External settlement account is credited
• Ledger stays balanced
• SPI flow reconciles automatically

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Pix refund

• A reversal transaction mirrors the original
• Parent transaction is linked
• Compliance rules are enforced

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Marketplace escrow

• Funds collected into a holding account
• Fees allocated transparently
• Merchant settlements triggered via Operation Routes

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Fee Engine

• Fee revenue and fee expense accounts automatically updated
• No manual intervention needed

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6. Next Steps — From accounting to reporting with Reporter

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Accounting alone does not close the loop — financial data must be transformed into structured, auditable, and regulatory — compliant reports. This is where Lerian Reporter becomes a natural extension of Midaz’s accounting layer. Reporter consumes ledger events, portfolios, segments, balances, and transaction metadata to produce high-fidelity financial outputs, aligned with your operational and regulatory needs.

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How Reporter fits into your accounting workflow

Reporter acts as a data extraction and transformation engine, designed to turn Midaz’s structured ledger into:

• Daily operational reports
• Reconciliation files
• Financial statements
• Compliance outputs
• Provider integrations

Its design ensures consistency between what happens in the ledger and what your business reports externally.

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COSIF and regulatory alignment

If your institution needs to comply with COSIF (Brazilian accounting standard) or similar regulatory frameworks, Reporter provides:

• A flexible mapping layer to translate ledger accounts and segments into COSIF lines
• Support for hierarchical structures
• Automated grouping and aggregation rules
• Deterministic outputs suitable for regulatory submission

Midaz manages the accounting logic. Reporter transforms that logic into regulatory-grade files.

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Why use Reporter alongside Midaz?

Together, they close the accounting cycle:

1. Midaz Ledger ensures structured, real-time, double-entry financial events.
2. Transaction Routes and Operation Routes provide deterministic accounting behavior.
3. Reporter extracts, aggregates, and composes financial and regulatory artifacts.

This gives your institution:

• Full traceability
• Audit-ready records
• Consistent financial narratives
• Seamless COSIF mapping
• Automated compliance workflows