# Accounting Basics

> Apply core accounting principles — double-entry, accruals, matching, and chart of accounts design — so books remain accurate and decision-useful. Use when setting up books, training non-accountants, or diagnosing accounting quality issues.

- Skill: `itsual/accounting-basics` (Agent Skill)
- Install (CLI): `npx skillmds@latest add itsual/accounting-basics`
- Raw SKILL.md: https://api.skillmd.com/api/skills/itsual/accounting-basics/raw
- Safety review: pending
- Works with: Claude Code, Claude.ai, OpenAI Codex
- Category: Finance & Business
- Author: itsual (https://skillmd.com/u/itsual)
- Updated: 2026-09-21
- Page: https://skillmd.com/skills/itsual/accounting-basics

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# Accounting Basics

## Overview

Accounting records economic activity so stakeholders can understand performance and position. Basics done well prevent costly cleanup and bad decisions later.

## When to Use

- Setting up or restructuring books
- Training operators on financial literacy
- Diagnosing messy ledgers
- Bridging operational events to journal entries

## Core Concepts

- Double-entry (debits and credits)
- Accrual vs cash basis
- Matching principle
- Chart of accounts design
- Assets, liabilities, equity, revenue, expenses

## Principles

- Every transaction has two sides
- Period cut-off discipline prevents distorted results
- Chart of accounts should match how the business is managed
- Documentation supports audit and trust

## Verification

- [ ] Trial balance concepts are understood
- [ ] Accruals and cut-off are applied consciously
- [ ] Account structure supports reporting needs