How to Set Up a Nominal Ledger
- 1). Write the title of your nominal ledger at the top of a blank piece of paper to describe the account you are working on. For instance, if you are setting up the nominal ledger for your company's petty cash account, write "petty cash" and the name of your business. You can also use a computer spreadsheet or a specially designed software such as Sage or Quick Books to setup your nominal ledger.
- 2). Set a date column for your transactions. If you are using a nominal ledger notebook, just label the first column with the word date. If you are using a blank piece of paper, draw two vertical parallel lines on the left-hand side to enclose your date column and write "date" at the top of the column.
- 3). Create another column for your business reference number. Use this column to label your transactions, so if a query comes up, you can easily identify and locate the transaction.
- 4). Create another column and label it "description." Use this column to provide a brief description of each transaction.
- 5). Draw two more columns: one for your debit and one for your credit transactions. Write the amount of each transaction in its relevant column.
- 6). Establish what accounting period you will use for your nominal ledger. Most businesses choose to work with a calendar year, January to December, while others choose a fiscal year that does not start and end in the same year. At the end of your business period your nominal ledger must always be kept in balance; in other words, the debits registered in the ledger must offset the credits.
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