General Ledger (GL)

Every economic event — trades, income, expenses, capital activity, fees, valuation changes — is recorded in the general ledger as balanced debits and credits posted to accounts defined in the chart of accounts. Subledgers, such as the investment ledger, investor capital register and accounts payable, feed summarized or detailed entries into the GL.

In fund accounting, the GL is the authoritative source for the NAV. Most portfolio accounting systems generate GL entries automatically from trades and events (the ABOR), with manual journal entries used for accruals, adjustments and corrections. The GL must support reporting by fund, share class, series and sometimes by investor, and in multiple currencies.

Key controls include period locks after NAV sign-off, reviewed manual entries, regular tie-outs of subledgers to control accounts, and a documented audit trail showing who posted what and when. A common weakness is a GL that does not reconcile to the investment subledger or capital register, forcing manual adjustments at month-end.