The double entry principle states that every transaction in financial accounting has two equal and opposite effects, namely a debit entry and a corresponding credit entry. This means that for every debit entry made, there must be a corresponding credit entry, and vice versa. The principle is based on the idea that every financial transaction affects at least two accounts in a company's financial records. By following this principle, the accounting system ensures that the books are always in balance, and that the total amount of debits recorded must equal the total amount of credits recorded.