Chapitre 2 - Financial statements Source : BooksTime, www.bookstime.com/what- is- the- accounting- equation The cash (basis) accounting method is the simplest way to keep a business's books: revenues are recorded when collected and expenses are recorded when paid. However, it only gives a view on the organization's cash position. Understanding cash and accrual accounting methods: Cash: Recognizes income and expenses when funds are received or disbursed. Accrual: Recognizes income and expenses when the activity takes place to create revenue or obligation to pay. In the Anglo- American world, the chart of accounts numbering system is not learned as such. The types of accounts have to be remembered much more than their number. Equity represents the owners' share in the company including the accumulated profit and dividends paid. Liabilities represent all obligations needed to be fulfilled and they must be shown as financial commitments in the short term or in the long term. Manual accounting entries used to be made into accounting journals. Accounting journals still exist in digital format. All entries are eventually reported to a general ledger. Details for a general ledger control account such as accounts payable, or accounts receivable are shown in a subsidiary ledger. 125http://www.bookstime.com/what