A distributed or shared ledger is a digital database of records. These records contain information relevant to a group of participants within a network.
In a distributed ledger all participants are looking at a common view of the records. This is in contrast to a typical situation currently where participants (for example, in different organisations) are looking at different databases that are independently managed and updated.
As Distributed Ledger Technology (DLT) matures, the shared ledger’s common view of records and transparency of transaction history could reduce reconciliation across different databases and drive significant efficiencies. Business processes that are characterised by inefficiencies (eg trade finance), or exist because of a lack of trust (eg Know Your Customer requirements in financial services) or poor supply chain visibility (eg for global garment supply chains) are all key areas for distributed ledger applications.
This report introduces and explores the concept of distributed ledgers, examines its commercial potential and how this relates to different aspects of professional accountancy.