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by arethuza 4640 days ago
Isn't it round the other way for banks - their assets are things like loans (which are liabilities to the borrowers)?

If you deposit £50 pounds in the bank the cash becomes an asset of the bank and they create a matching liability to you because you probably want your money back at some point in the future....
1 comments
onebaddude 4640 days ago
>If you deposit £50 pounds in the bank the cash becomes an asset of the bank

Deposits are liabilities to a bank.

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arethuza 4640 days ago
Yes, but the cash you deposited becomes a balancing asset.... surely (I am not an accountant).
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VLM 4640 days ago
I am not in banking finance but I think the double entry accounting would be if you deposit a $20 bill that physical $20 bill shows up on the "physical stack o cash" as an asset and the other entry (double entry, get it?) shows up as a liability in accounts payable because they owe you $20.

I was in IT at a stock trading firm a long time ago and the limited free training they provided for accounting was probably the most interesting non-job related on the job training I ever attended.

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