What are subsidiary records?

Subsidiary records refer to additional ledger accounts that provide detailed information about individual transactions or specific groups of transactions. They support and complement the general ledger by breaking down aggregated data into more granular details. This facilitates better tracking and management of various accounts, such as accounts receivable or accounts payable, by allowing businesses to monitor individual customer or supplier transactions separately.

For instance, in accounts receivable, a subsidiary record would show the amounts owed by each customer, making it easier to manage collections and assess credit risk. Similarly, in accounts payable, it can help in managing and tracking what is owed to each supplier. This structured detail aids in ensuring accurate financial reporting and enhances overall accountability in financial management.

In contrast, the other choices don't reflect the concept of subsidiary records. General journal entries are part of the initial recording process that summarizes transactions but lack the detailed breakdown. Daily cash flow statements summarize cash inflows and outflows but do not provide individual transaction details. Bank reconciliation statements compare company records with bank records and also do not function as subsidiary records. Thus, the understanding of subsidiary records is crucial for maintaining accuracy and clarity in accounting practices.