Glossary · Also called Folio reference
Folio
A reference code that links an entry to the page or account it came from or goes to.
What it means
A cross-reference recorded against an entry showing the related ledger or book of prime entry.
Example
A cash book entry carries a folio pointing to the customer's account in the sales ledger.
Why it matters
Folio references make it possible to trace an entry to its double-entry partner.
In practice
A folio is a narrow reference column in the ledger and in the books of prime entry, between the details and the money columns. It holds a code, not a value. It links one entry to its partner elsewhere. An entry posted from the sales journal to the sales ledger might show a folio such as "SL 7", meaning sales ledger page 7. This lets anyone trace a figure from the day book to the account it was posted to, and back again. That is useful when checking or auditing the books.
For example, RM250 in the purchases day book carries the supplier's ledger folio, so the credit posting can be found at once.
The folio is easily mixed up with the narrative. The folio is a short locating reference in its own column. The narrative is a sentence of explanation under a journal entry. The folio guides you to a place. It does not justify the entry.
If posting and cross-referencing feel fiddly, one of our teachers can practise a few full postings with you until the routine is clear. Book a trial class.
Related terms
Definitions here are general accounting explanations for study. For your board's exact wording, see its official syllabus via Sources.
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