Comment by nonethewiser
6 hours ago
What did you find hard to understand about double entry accounting? Seems pretty straightforward. Every transaction affects at least two accounts, and the total debits must equal the total credits. I can't imagine how introducing graph theory simplifies it, although I trust there are interesting insights none-the-less.
>What did you find hard to understand about double entry accounting?
I didn't understand the point of the two entries.
My prior experience with bookkeeping was that I imported my bank statements into some tool and categorized each transaction. So, if I bought a cookie for $5, I'd mark that transaction as "food," and that felt intuitive to me. I didn't understand why it would become two transactions where one is food and the other is my cash. It just felt like, why split it into two? What does that do for me?
The "ah-ha" moment from Kleppman's post was seeing how it's not just about creating two entries but about defining flows between accounts. The graphs helped because they show how balances increase or decrease as you traverse the nodes.
To be clear, it wasn't like I spent hours banging my head against the wall trying to understand double-entry accounting and failed until Kleppman's post. It was just that I'd encountered the idea a few times, and it never clicked until Klepmman.
I think it explains the "why" of double entry accounting. Since it is used to track flows of money, a graph representation is a natural representation (just not the only one and not necessarily the most useful for day to day operations).
That core idea is simple. But the details, such as credit and debit having the opposite meaning to casual bank account accounting, and the use of a variety of accounts makes things not intuitive.