What Is a Subledger?
A subledger is a detailed ledger that holds the individual transactions behind a summary (control) account in the general ledger. Common subledgers include accounts receivable, accounts payable, inventory, and fixed assets — each rolling up to a single balance in the general ledger.
What a subledger is and why it matters
Subledgers keep the general ledger clean while preserving the detail a business needs. Rather than listing every customer invoice in the general ledger, the AR subledger holds them and reports a single total to the AR control account. This structure lets you answer both "what's our total receivables?" (the general ledger) and "which customers owe what?" (the subledger). A core control is that each subledger must reconcile to its control account — if they don't tie, an entry is missing or misposted. Subledger reconciliation is a standard step in a reliable close.
A worked example
A company's accounts-payable subledger lists what it owes each vendor: Supplier A $12,000, Supplier B $8,000, Supplier C $5,000 — $25,000 total. The general ledger's accounts-payable control account should also read $25,000. If the general ledger shows $27,000, the $2,000 difference signals a posting that hit the control account without a matching vendor entry — found and fixed during subledger reconciliation.
How firms handle it today
Firms reconcile each subledger (AR, AP, inventory, fixed assets) to its general-ledger control account at close, resolving any differences before financial statements are produced.
Related terms
- General ledger
- Ledger
- Reconciliation
- Chart of accounts
- Trial balance
FAQ
What's the difference between a subledger and the general ledger?
The subledger holds detailed transactions for one account type; the general ledger holds the summarized control balance and all accounts.
What are common subledgers?
Accounts receivable, accounts payable, inventory, fixed assets, and payroll.
Why reconcile a subledger to the general ledger?
To confirm the detail matches the summary — a mismatch means a missing or misposted entry to find before closing.