Memo entry

A memo entry is a transaction that contains no postings to the general ledger. This entry is used for stock splits, where the number of shares outstanding changes, but there is no alteration of the underlying equity accounts. The entry is used to note the change in shares outstanding. An example of a memo entry is, β€œOn [date], a 2:1 stock split occurred, which increased the number of shares outstanding from 50,000 to 100,000.” Many organizations elect not to use memo entries at all.