On Sun, 25 Sept 2022 at 19:42, Martin Blais <[email protected]> wrote: > I'm still not 100% sure what you'd like me to change. You'd like for this > text to be inserted in the doc?
I think this needs to change: 1c1 < Moreover, posting a positive amount on an account is called “crediting” and removing from an account is called “debiting.” --- > Moreover, posting a positive amount on an account is called “debiting” and > removing from an account is called “crediting.” > Even after all these years I still find these words inconvenient; why is a > "debit card" called a debit card, when its purpose is to take money out? And > what about the sentence "we'll credit it to your account"? One can always > make sense of these by flipping the perspective between the recipient vs. > sender. (e.g. debiting to one's cash account). And it's more than just the > sign convention we choose: I find I have to have the context to be able to > make sense of the words right. So I prefer not to use them. Indeed! Debit and credit use absolute values |x| since they were devised in a part of the world where negative numbers had not yet taken hold. That is why using terms like "increase" and "decrease" become difficult since an "increase" with an absolute value could be a "decrease" in the signed value _or_ could be an "increase" in the signed value, depending on the kind of account (AE vs. RLX). It's all thus very confusing. However, within the framework of double-entry accounting, if we think of transactions as being directional, with "to" account(s) and "from" account(s), then you're "debiting" the "to" account, and "crediting" the "from" account, irrespective of the signs that PTA imposes. The "debit" in "debit card" is in line with bank statements' use of the term "debit" for when your account checking account balance goes down. As to why in your bank statement, "debit" and "credit" get reversed, it's of course because they are described from the bank's point of view. When you add money to your account, the bank's liability goes up in absolute value (liability gets credited), whereas if you take out money from your account the bank's liability towards you goes down in absolute value (liability gets debited). So insofar as the bank's relation to you is concerned, your account gets debited when you take away money and gets credited when you add money, whereas from your point of view, your account gets debited when you add money, and credited when you take away money. > As for pta, thanks for pointing it out, I wasn't aware of it. At first I look > at the convention and I'm thinking "that's a weird choice" but I suppose it's > arbitrary and I have to admit that Ledger and Beancount's choice is also > probably looking similarly strange from an accountant's POV. My own surprise > at the reverse convention leads me to think maybe I should implement the > option to have all positive numbers and flipping the signs automatically on > reading. I proposed a while ago we should be able to flip on input and > output (but the output part's more complicated, because it would have to be > applied on the result of doing all the calculations so it's more a reporting > feature). I wonder how many people would find that useful. It's pretty easy > to add. Signs are mere conventions. If you want to have your mind blown, check out the differences between the IMF's "Balance of Payments Manual" v5 and v6: https://www.imf.org/external/pubs/ft/bop/2007/bpm6faq.pdf In BPM5, credits were represented with positive sign and debits with negative sign. So increases in assets were negative signed, and increases in liabilities were positively signed. (Just like the pta(1) tool.) In BPM6, increases in both assets and liabilities are positive and decreases in both assets and liabilities are negative. So a minus sign in BPM6 is "the net incurrence of liability". So, in BPM5, a PTA-like signed-accounting notion of +ve and -ve were used, whereas with BPM6, an unsigned-accounting notion of +ve and -ve are used. Cheers, Pranesh -- You received this message because you are subscribed to the Google Groups "Beancount" group. To unsubscribe from this group and stop receiving emails from it, send an email to [email protected]. To view this discussion on the web visit https://groups.google.com/d/msgid/beancount/CAPD_o%2B8W2BpTA9qtmMvaTdqdW51v%2Bt5uFrMRbZ93aPqoWokzQw%40mail.gmail.com.
