Before we jump into blockchain and delve into Hyperledger Fabric and the Oracle Cloud solution, we need to start with two core principles—ledger and accounting. In an accounting system, business transactions are recorded in journals and ledgers. Fine-grained details of every transaction are entered into various journals. Summarized information from the journals is then transferred (also known as posted) to a ledger. It is the information from the ledger that becomes the source for trail balances and various financial statements. Every transaction is recorded in journals and then posted to a ledger that records this information in various accounts, such as asset accounts, liability accounts, equity accounts, revenue accounts, and expense accounts.

For any organization's accounting system, the ledger is the backbone. Anything that has financial value is posted to the organization's ledger. However, these ledgers are centralized ledgers and the organization has full control over them. We will talk about centralized and decentralized ledgers later in this chapter.