Ledger

Introduction

The Ledger gem is a comprehensive implementation of a double-entry bookkeeping system, following the principles of Double-Entry Bookkeeping. Key features include:

• Requires source documents
• Creates transfers and double-entry lines (which may exceed two) in the database
• Maintains current balances for each account

Note: This gem does not enforce accounting rules beyond optionally ensuring positive balances and an allowlist of approved transfers. It utilizes the Money gem for currency operations.

What This Gem Does

• Provides a base table for documents, connectable to business models via a polymorphic association
• Includes a chart of accounts table where the id represents the account number (e.g., ledger_accounts.id = 331)

Installation

Before you install

GEM IS STILL IN ALPHA MODE, NOT DEPLOYED YET

Steps to install

1. bundle add double_entry_ledger or gem install double_entry_ledger if you are not in rails and also check out additional steps
2. rails g ledger::install
3. In the migration, update tenant_table_name and user_accounts_table_name to your tables, for all the required FKs.

tenant_table_name = "tenants"
user_accounts_table_name = "accounts"

4. In the created ``
5. Add the following code to your Tenant and Person models:

# models\tenant.rb
class Tenant < ApplicationRecord
  has_many :transfers, class_name: "Ledger::Transfer", foreign_key: "tenant_id"
end

# models\person.rb # This is an example of a name.
class Person < ApplicationRecord
  has_many :account_balances, class_name: "Ledger::AccountBalance", foreign_key: "person_id"
  has_many :entries, class_name: "Ledger::Entry", foreign_key: "person_id", inverse_of: :person
  has_many :transfers, through: :entries, source: :ledger_transfer
  has_many :documents, through: :transfers, source: :ledger_document
end

Replace UPDATE_WITH_YOUR_GEM_NAME_PRIOR_TO_RELEASE_TO_RUBYGEMS_ORG with your gem name after releasing it to RubyGems.org. If not releasing to RubyGems.org, replace this section with installation instructions from git.

To install and add the gem to your application's Gemfile, run:

$ bundle add UPDATE_WITH_YOUR_GEM_NAME_PRIOR_TO_RELEASE_TO_RUBYGEMS_ORG

If not using Bundler, install the gem with:

$ gem install UPDATE_WITH_YOUR_GEM_NAME_PRIOR_TO_RELEASE_TO_RUBYGEMS_ORG

In order to use this gem you need to have tenant and person models in your app already. When running rails g ledger::install

Configuration

Non-Rails

If not using Rails, initialize with:

MoneyRails::Hooks.init

Usage

erDiagram
    ledger_documents {
        bigint ledger_document_type_id PK
        date date
        string number
        string description
        text comments
        text internal_comments
        string documentable_type
        bigint documentable_id
        string external_id
    }
    
    ledger_document_types {
        string name PK
        string description   
    }
    
    
    ledger_entries {
        bigint ledger_transfer_id
        bigint ledger_account_id
        bigint account_id
        boolean is_debit
        integer amount_cents
        string amount_currency
    }
    
    ledger_transfers {
        date date
        bigint ledger_document_id
        string description
    }

    
    ledger_account_balances {
        bigint account_id
        integer balance_cents
        string balance_currency
        bigint ledger_account_id
        date date
    }
    

    ledger_documents ||--o| ledger_document_types : "has"
    ledger_transfers ||--o| ledger_documents : "references"
    ledger_entries ||--o| ledger_accounts : "belongs to"
    ledger_entries ||--o| ledger_transfers : "references"
    ledger_entries ||--o| ledger_people : "optional belongs to"
    ledger_account_balances ||--o| ledger_people : "belongs to"
    ledger_account_balances ||--o| ledger_accounts : "belongs to"
    ledger_account_balances ||--o| ledger_people : "date balance"

Loading

First of all you must setup

• chart of accounts
• person
• use or opt-out of tenancy
• use or opt out of accounting periods

Then you can go to the actual double entry api, transfers.

Chart of Accounts

erDiagram
    ledger_accounts {
        bigint id
        string name
        integer type
        string official_code
    }

Loading

The main accounts are stored in the ledger_accounts table, accessible via Ledger::Accounts. The id column represents the account number and should be provided by the user (it is not auto-incremented). Key attributes include:

• id: Account number (positive integer)
• name: Name of the account
• type: Type of account (:passive, :active, :mixed)
• official_code: Optional code for the account

# Example account creation
Ledger::Accounts.new(id: 1200, name: "Accounts Receivable", type: :active)

Sub-accounts

The transfers between specific persons is implemented, however, if you would need to add additional sub-accounts, like for example a location to an account, and a person is not enough, you must extend the person table to handle that.

erDiagram
ledger_people {
        string personable_type
        bigint personable_id
    }

Loading

Balances

Details on managing balances will be added here.

Tenancy

Tenancy support is optional.

Accounting Periods

Accounting periods support is optional.

Transfers

Transfer money from one account to another with the following method, with a person account on either side, or none at all. The Ledger.transfer is the main entry point. It accepts a not saved transfer object, that is required to have a document, date and other fields filled out. A Ledger.transfer may process a single transaction or a set of transactions at the same time, by passing a :transactions hash key with an array of transaction hashes you execute multiple transactions.

When passing a person, it will find_or_create a account_balances entry for that person, account. And date (read accounting period), and tenant if these options are included.

Parameters

• transfer [Ledger::Transfer::Instance]: A prepared transfer object (not saved in the db).
• options [Hash]: Options including:
  • :amount [Money]: Amount to transfer.
  • :debit [Ledger::Account::Instance, Integer]: Debit side.
  • :credit [Ledger::Account::Instance, Integer]: Credit side.
  • :person_debit [Ledger::Person::Instance]: Optional person on the debit side.
  • :person_credit [Ledger::Person::Instance]: Optional person on the credit side.
• :transactions [Array]: Array of transaction hashes with the listed under options above for each element.

Examples

Single Transaction Without a Person

transfer = Transfer.new(document: document, date: Date.today, description: 'Transfer description')
Ledger.transfer(
  transfer: transfer,
  amount: Money.new(20_00, 'USD'),
  debit: Ledger::Account.find_by(111),
  credit: 222
)

Single Transaction With a Person on Debit Side

Money is being transfered

transfer = Transfer.new(document: document, date: Date.today, description: 'Transfer description')
Ledger.transfer(
  transfer: transfer,
  amount: Money.new(20_00, 'USD'),
  debit: ledger_account_a,
  credit: ledger_account_b,
  person_debit: person_a
)

Single Transaction With People on Both Sides

transfer = Transfer.new(document: document, date: Date.today, description: 'Transfer description')
Ledger.transfer(
  transfer: transfer,
  amount: Money.new(20_00, 'USD'),
  debit: ledger_account_a,
  credit: ledger_account_b,
  person_debit: person_a,
  person_credit: person_b
)

Complex Transfer With Multiple Transactions

transfer = Transfer.new(document: document, date: Date.today, description: 'Transfer description')
Ledger.transfer(
  transfer: transfer,
  transactions: [
    {amount: Money.new(20_00, 'USD'), debit: account_a, credit: account_b},
    {amount: Money.new(20_00, 'USD'), debit: account_a, credit: account_c, person_debit: person_a}
  ]
)

Errors

• Ledger::TransferIsNegative: Raised if the amount is less than zero.
• Ledger::TransferAlreadyExists: Raised if the transfer instance is already recorded.
• Ledger::InsufficientMoney: Raised if the account has insufficient funds.
• Ledger::TransferNotAllowed: Raised if the transfer is not permitted.

Development

This gem uses development containers, with vs code. If you already have VS Code and Docker installed, you can click the badge above or here to get started. Clicking these links will cause VS Code to automatically install the Dev Containers extension if needed, clone the source code into a container volume, and spin up a dev container for use.

Then, run rake spec to run the tests. You can also run bin/console for an interactive prompt that will allow you to experiment.

TODO: check this To install this gem onto your local machine, run bundle exec rake install. To release a new version, update the version number in version.rb, and then run bundle exec rake release, which will create a git tag for the version, push git commits and the created tag, and push the .gem file to rubygems.org.

Contributing

Bug reports and pull requests are welcome on GitHub at https://github.com/[USERNAME]/ledger. This project is intended to be a safe, welcoming space for collaboration, and contributors are expected to adhere to the code of conduct.

License

The gem is available as open source under the terms of the MIT License.

Code of Conduct

Everyone interacting in the Ledger project's codebases, issue trackers, chat rooms and mailing lists is expected to follow the code of conduct.

Thanks

Inspired by double_entry gem by Envato, parts of the code have been copied over or adapted. And plutus gem