What is a sales ledger?
A sales ledger is the record of everything each customer has been invoiced and everything they have paid, kept account by account. It shows who owes money, how much, and how long it has been outstanding. In UK bookkeeping it is also called the debtors ledger or accounts receivable ledger, and its total must agree with the debtors control account in the nominal ledger.
Also called Accounts receivable ledger, Debtors ledger
What a sales ledger account holds
One account per customer, and against it every document that has affected their balance:
- Invoices raised, with date, reference, net, VAT and gross.
- Credit notes issued against those invoices.
- Receipts, and which invoices each receipt was allocated to.
- The resulting balance, and the age of each unpaid item.
Allocation is the part that matters
Recording a receipt is only half the job. It has to be allocated against the specific invoices it settles, otherwise the balance is right but the ageing is wrong — and the ageing is what tells you who to chase.
A customer who pays £5,000 against an £8,000 balance has left something unpaid. Until that £5,000 is matched to particular invoices, the ledger cannot say whether what remains is 30 days old or 120, and a debt-chasing letter based on it will be wrong.
Aged debtors
The aged debtors report is the sales ledger sorted by how overdue each item is, usually in 30-day bands: current, 30, 60, 90, older. It is the single most-used report in the ledger, because it converts a list of balances into a list of actions.
Sales ledger versus purchase ledger
They are mirror images. The sales ledger records money owed to you and produces debtors; the purchase ledger records money you owe and produces creditors. Between them they cover the whole trading relationship, and both post their totals into the nominal ledger.
What this looks like in an accounting system
The screen that matters most on the sales ledger is the allocation screen, not the invoice screen. The pattern is the same in any system worth using: pick the receipt, pick the invoices it pays, set the amount against each — defaulting to the open balance — and save. Saving is what closes the open balances down and posts any settlement discount.
Partial payments and foreign currency are where it gets interesting. A receipt that does not match an invoice exactly needs a partial allocation rather than a suspense posting, and a receipt in a different currency from the invoice has to be converted at the right rate before it can be matched at all.
Debt chasing then runs off the ageing. A common design is a set of age bands, each with its own letter — a polite reminder at the first, a pre-legal warning at the last — so the tone escalates with the age of the debt instead of every overdue account getting the same letter.
Sales ledger questions.
What is the difference between a sales ledger and a nominal ledger?
The sales ledger holds the detail by customer — who owes what and since when. The nominal ledger holds the totals by account. A sales invoice appears in both: against the customer in the sales ledger, and against Debtors and Sales in the nominal ledger.
Is the sales ledger the same as accounts receivable?
In practice yes. "Sales ledger" is the usual UK term and "accounts receivable" the American one. Strictly, accounts receivable is the balance owed and the sales ledger is the record that produces it.
What is a sales ledger control account?
It is the account in the nominal ledger that holds the total of every customer balance. It exists so the nominal ledger can show one figure for debtors instead of thousands, and reconciling it to the sales ledger is a standard month-end check.
What is a sales ledger clerk?
A role responsible for running the sales ledger day to day — raising invoices, posting and allocating receipts, reconciling the control account and chasing overdue accounts. Also called a credit controller or accounts receivable clerk.
Trade Ledgers
See the sales ledger running: receipts matched across invoices in one screen, foreign-currency allocation handled, and debt-chasing letters that escalate by age band.
Explore the Trade LedgersNext in the glossary.
What is a purchase ledger?
A purchase ledger is the record of everything each supplier has invoiced you and everything you have paid them, kept account by account.
Read the definition →What is a nominal ledger?
A nominal ledger is the central accounting record that holds every financial transaction a business makes, summarised by account.
Read the definition →Aged debtors and aged creditors
An aged debtors report lists what every customer owes, split by how long it has been outstanding — typically current, 30, 60, 90 and older.
Read the definition →