> ## Documentation Index
> Fetch the complete documentation index at: https://docs.lerian.studio/llms.txt
> Use this file to discover all available pages before exploring further.

# Accounting in Lerian

> How the accounting ideas you've learned map onto real Lerian and Midaz entities — accounts, transactions, operations, and routes — so the concepts and the product line up.

Everything in this guide has been about accounting in general. This page connects it to the system you're actually here for. The good news: **Midaz doesn't reinvent accounting — it implements it.** The terms you've already learned have direct counterparts in the product, and once you see the mapping, the documentation reads like a language you already speak.

## The same ideas, renamed for a ledger

***

From here on, the words get more product-specific — but don't let that throw you. The accounting ideas stay exactly the same; only the names change. Here's the whole bridge in one table: each accounting idea on the left is something concrete in Midaz on the right.

| Accounting idea                                                                                  | In Lerian / Midaz                                          |
| ------------------------------------------------------------------------------------------------ | ---------------------------------------------------------- |
| [Chart of accounts](/en/fundamentals/accounting/chart-of-accounts)                               | The **account hierarchy** inside a Ledger                  |
| The five account families (assets, liabilities, equity, revenue, expense)                        | How you **structure and group** accounts in that hierarchy |
| [Journal entry](/en/fundamentals/accounting/journal-entries)                                     | A **transaction** made of **operations**                   |
| A single debit or credit line                                                                    | One **operation**                                          |
| [Double-entry](/en/fundamentals/accounting/double-entry-bookkeeping) — debits must equal credits | A transaction's operations **always balance**              |
| Which accounts a kind of entry may touch                                                         | An **accounting route**                                    |

```mermaid theme={null}
flowchart LR
    subgraph ACC["Accounting"]
        direction TB
        CA["Chart of Accounts"]:::a
        JE["Journal Entry"]:::a
        DC["Debit / Credit rule"]:::a
    end
    subgraph MID["Lerian / Midaz"]
        direction TB
        AH["Account Hierarchy"]:::m
        TO["Transaction + Operations"]:::m
        AB["Always Balanced"]:::m
    end
    CA --> AH
    JE --> TO
    DC --> AB
    classDef a fill:#dbeafe,stroke:#2563eb,color:#1e3a8a
    classDef m fill:#dcfce7,stroke:#16a34a,color:#14532d
```

The rest of this page walks through the rows that matter most.

## Chart of accounts → the account hierarchy

***

A [chart of accounts](/en/fundamentals/accounting/chart-of-accounts) is the organized list of buckets a business sorts its money into. In Midaz that idea becomes the [account](/en/fundamentals/core-banking/building-blocks) — a container that holds value for a specific asset and carries a [balance](/en/fundamentals/core-banking/building-blocks). Accounts aren't a flat list: they're arranged in a **hierarchy**, so you can nest and group them to mirror how a real business is structured. The five accounting families — assets, liabilities, equity, revenue, expenses — are exactly the kind of grouping that hierarchy is built to express.

A [Ledger](/en/fundamentals/core-banking/building-blocks) is one self-contained book of records, and an Organization can hold several. So your chart of accounts lives as the structured set of accounts inside a Ledger — the same map of "where value lives," given room to scale.

## Journal entry → transaction + operations

***

A [journal entry](/en/fundamentals/accounting/journal-entries) records one event as matching debits and credits. Midaz splits that single idea into two precise words you'll see everywhere in [how money moves](/en/fundamentals/core-banking/how-money-moves):

* A **transaction** is one complete movement of value — the whole event, start to finish. That's the journal entry.
* An **operation** is one part of that movement — a single debit or a single credit. Those are the individual lines of the entry.

So when you recorded "Cash debited \$2,000, Revenue credited \$2,000" as a journal entry, the Midaz version is **one transaction made of two operations**. Same event, same two sides, just the product's vocabulary for them.

```mermaid theme={null}
flowchart TD
    A["Journal entry<br/><i>accounting</i>"]:::acc --> B["Transaction<br/><i>the whole movement</i>"]:::mid
    B --> C["Operation<br/>debit"]:::mid
    B --> D["Operation<br/>credit"]:::mid
    C --> E["Debits total"]:::tot
    D --> F["Credits total"]:::tot
    E --> G["Transaction balances"]:::bal
    F --> G
    classDef acc fill:#dbeafe,stroke:#2563eb,color:#1e3a8a
    classDef mid fill:#dcfce7,stroke:#16a34a,color:#14532d
    classDef tot fill:#f3f4f6,stroke:#6b7280,color:#111827
    classDef bal fill:#fde68a,stroke:#d97706,color:#78350f
```

## Double-entry → transactions always balance

***

The iron rule of accounting — [debits must equal credits](/en/fundamentals/accounting/debits-and-credits) — is built straight into how Midaz records movement. In a transaction, everything debited must equal everything credited; if the two sides don't match, the movement won't go through. A transaction is also **all-or-nothing**: either every operation succeeds together or none of them do, so the books can never be left half-recorded.

This is the same trustworthiness promise the whole guide keeps coming back to — value never appears or vanishes without a recorded reason; every movement has a clear source and a clear destination — now enforced by the system instead of by hand. The [core-banking explanation of how money is recorded](/en/fundamentals/core-banking/double-entry-explained) covers this from the ledger's side.

## Accounting routes → which accounts may take part

***

In plain accounting you decide by judgment which accounts a given kind of entry should touch; in Midaz that judgment is captured once as an [accounting route](/en/fundamentals/core-banking/routes-and-fees) — a reusable rule that fixes who can send, who can receive, and which debits and credits get recorded — and a **fee** is just more balanced operations on the same transaction.

For example, a wallet transfer's route fixes which customer account may be **debited**, which customer account may be **credited**, and which **fee accounts** join in when a fee applies. The [core-banking guide to routes and fees](/en/fundamentals/core-banking/routes-and-fees) walks through it in full.

## A note on holders and accounts

***

In Midaz the [account](/en/fundamentals/core-banking/holders-accounts-aliases) is just the balance container, while the real-world owner is a separate **holder** record and friendly nicknames are **aliases** — kept deliberately separate so the Ledger's record of value stays clean. If that distinction matters for your work, [who owns what](/en/fundamentals/core-banking/holders-accounts-aliases) untangles it.

## In short

***

* Midaz **implements** the accounting you've learned — it doesn't replace it.
* A **chart of accounts** becomes the **account hierarchy** inside a Ledger; the five account families are how you group it.
* A **journal entry** becomes a **transaction** (the whole movement) made of **operations** (its individual debits and credits), and those operations **always balance**.
* An **accounting route** captures, once, which accounts may take part in a kind of movement — and a **fee** is just more balanced operations on the same transaction.

<Note>
  **Go deeper**

  To see these entities in full, continue into the [Core banking fundamentals](/en/fundamentals/core-banking/what-is-core-banking), or revisit any idea from the [Accounting overview](/en/fundamentals/accounting).
</Note>