Disadvantages of single entry accountancy :

1. That it is an incomplete​ system of accountancy.

2. That frauds are generally committed through this system of accountancy.

3. That errors in accounts rendered by single entry system are not easily traceable.

4. That sufficient information which is required for preparing final accounts, as to the sources of receipts are not found for reliability of final accounts.

5. That information regarding sources of profit and the nature and amount of expenses incurred is not available in single entry system of accountancy.

Criticism of the alleged disadvantages -

  Above mentioned disadvantages of single entry book keeping are baseless and rather a fallacy of four terms. I am criticizing all the above mentioned disadvantages in successive order as follows :

A. The allegation that it is an incomplete system of accountancy is quite erroneous. Whatever is shown by double entry system is obviously mentioned in the footnotes of every item of the journal, whether debit or credit and the concerned khata or ledger folio is clearly mentioned therein without duplicating the amount in the under nothings and all the amounts are clearly mentioned in different khata or ledger folios which also are noted in the same single entry system with certain details of receipts and expenditures shown in the khata Bahi or the journal.

B. The allegation that frauds are generally committed through this system of accountancy, is not correct. If one tallies the journal entries and the ledger entries, there is no question of committing any fraud or of any fraud remaining undetected.

C. The allegation that errors in accounts rendered by single entry system are not easily traceable, also is refuted. No error can escape a vigilant eye in the tallying of the Bahikatas and khata bahis (the journal and ledger) prepared under this system. In double entry system only cooked bread is seen or examined by the Department but in single entry system one has to see how the bread is cooked. The allegation should not be of committing errors but of escaping labour for which the business man is not at fault.

D. The allegation that sufficient information which is required for preparing final accounts, by single entry system is whimsical. Even more information may be found in single entry accounts if properly maintained than it is found in double entry accounts prepared by experts whose sole attempts are to save income tax and defraud the Revenue.


E. The last allegation that information regarding sources of profit and the nature and amount of expenses incurred is not available in single entry system of accountancy, is just like that a wolf says to the lamb that if it not you, your father must have depoiled  the water of the stream. When every item is brought in the journal with its proper source in the under nothing for transferring the item to the specific khata or ledger folio, what is the basis of the allegation. That the information regarding the sources of profit and amount of expenses incurred is not available in the single entry system of accountancy.

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