Notes on lesson on Rectification of Accounting Errors | kullabs.com

Rectification of Accounting Errors

Notes

Rectification of Errors

Accounting errors may be defined as those mistakes, which are generally committed while recording the financial transactions in the books of accounts and preparing the accounting statements. This note has information about accounting errors and its causes.

Types of Errors

Accounting errors can be classified into two types according to their common characteristics. They are errors based on their nature and errors based on disclosure of trial balance. This note has information about accounting errors and its types.

Suspense Account

The account opened to rectify the previous year’s one-sided errors is called suspense account. This note has information about suspense account, its preparation, utility and its disposal.

Methods of Locating and Rectifying Errors

Once an error is located, it should be properly corrected. The correction of accounting errors in a systematic manner is called the rectification of errors. This note has information about various methods of locating and rectifying errors.