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Types of Errors

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Accounting errors can be classified into two types according to their common characteristics. These are as follows:

  1. Types of errors based on their nature
  2. Types of errors based on disclosure of trial balance

Types of errors based on their nature

The following are the types of accounting errors based on their nature:

Clerical errors

The errors which are committed by accounting clerks are called clerical errors. These errors are committed in the process of recording financial transactions. These take place due to the carelessness of the clerk responsible for recording the financial transactions. Clerical errors are also called technical errors. The principal types of clerical errors are as follows:

  1. Errors of Omission
    The errors committed by not recording a transaction either in the book of original entry or in the ledger book are called errors of omission. Such an omission may be either complete or partial.
    • Complete omission
      Complete omission takes place if a transaction is not recorded in the journal at all. A complete omission of the transaction may occur due to many reasons such as sales invoice misplaced or lost.
    • Partial omission
      Partial omission occurs if the financial transaction is recorded only partially.

  2. Errors of Commission
    The errors which are committed while recording or posting a transaction are called errors of commission. Errors of the commission may take place either in the journal or in the subsidiary books, or in the ledger. Such errors include posting wrong amounts, posting on the wrong side of accounts, wrong totaling or carrying forward, and wrong balancing. Errors of commission may take place in the following ways:
    • Posting a wrong amount in subsidiary books and ledger
    • Posting in wrong account
    • Posting on the wrong side of an account
    • Obtaining a wrong total of subsidiary books and wrong balance of accounts

  3. Compensating errors
    Compensating errors refer to two or more errors which mutually compensate the effects of one another. If one error balances the effect of another error, then the two errors are called compensating errors. The errors in the personal account are compensated by each other.

  4. Errors of duplication
    Errors of duplication are those errors which arise because of double recording. Double posting of a transaction from journal or subsidiary books to ledger also create such errors.

  5. Errors of principle
    Errors of principle are those errors which occur by violating the basic principles of accounting. Errors of principle may occur due to the wrong allocation between capital and revenue expenditure, or wrong valuation of assets. Errors of principle may also occur due to the wrong valuation of assets by higher level staff.

Types of errors based on disclosure by trial balance

The accounting errors based on the disclosure by trial balance can be of following types:

Errors shown by trial balance

The errors that affect the agreement of the trial balance are called the errors shown by trial balance. The following are the errors that affect the totals of trial balance:

  1. Partial omission
    If a transaction is recorded or posted partially in the journal or in the ledger, such an error affects the agreement of the trial balance.
  2. Posting a wrong amount in an account
    Posting a wrong amount from the book of original entry to a ledger account affects the total of trial balance.
  3. Posting on the wrong side of an account
    If an amount is posted on the wrong side of an account from the book f original entry, such an error affects the totals of trial balance.
  4. Wrong casting of subsidiary books and wrong balancing of an account
    Incorrect totaling of subsidiary books and balancing of ledger account also results in the disagreement of the trial balance.

Errors not shown by the trial balance

The errors that do not affect the agreement of the trial balance are called the errors not shown by the trial balance. That mean, the trial balance agrees even if such errors exist. The following are some of the errors not shown by the trial balance:

  1. Complete errors of omission
    The complete omission of recording a financial transaction in the book of original entry or omission of posting an entry from journal to ledger accounts makes no impact on the totals of the trial balance. The totals of trial balance remain equal as no posting takes place on the debit and credit sides of accounts.

  2. Posting a wrong amount in subsidiary books and ledger
    Entering a wrong amount of a transaction to the another transaction in the subsidiary books and ledger accounts cannot be revealed by the trial balance.

  3. Posting in wrong account
    If an amount is wrongly posted on the right side of the wrong account then the error will not affect the agreement of the trial balance.

  4. Compensating errors
    Compensating errors are also not shown by the trial balance. Such errors do not affect the agreement of the trial balance.

  5. Errors of duplication
    The errors of duplication are also not revealed by the trial balance as they do not affect the agreement of the trial balance.

  6. Errors of principle
    Errors of principle are also not disclosed by the trial balance as such errors does not affect on the totals of the trial balance.



  • 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.
  • The errors which are committed by accounting clerks are called clerical errors. These errors are committed in the process of recording financial transactions. 
  • Compensating errors refers to two or more errors which mutually compensate the effects of one another.
  • The errors that affect the agreement of the trial balance are called the errors shown by trial balance. 
  • The errors that do not affect the agreement of the trial balance are called the errors not shown by the trial balance.
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Very Short Questions

The errors, which affect the agreement of the trial balance, are called the errors disclosed by the trial balance. The following errors can be disclosed by the trial balance: -

  1. Omitting to post in an account
    While posting a transaction from a subsidiary book to the ledger, if the amount of the transaction is omitted to post in one account, it affects the agreement of the trial balance.

  2. Posting wrong amount in an account
    If the amount of a transaction is posted in one account wrongly, it affects the agreement of the trial balance.

  3. Posting of amount in a wrong side of an account
    If the amount of a transaction is posted on wrong side of an account, it makes trial balance unequal. The wrong side posting affects the trial balance twice.

  4. Obtaining wrong total of a subsidiary book
    If the total of the subsidiary book is obtained wrongly, it is disclosed by the trial balance. For example, if the total of the sales book is obtained wrongly as Rs. 3,300 instead of Rs. 3,000, it makes credit total of the trial balance heavier by Rs. 300.

  5. Obtaining wrong balance of an account
    If the balance of an account is obtained wrongly, it affects the agreement of the trial balance.

  6. Bringing down a balance wrongly
    If the balance of an account is brought down wrongly, if affects the agreement of the trial balance. The accounting clerk may replace the balance of an account on wrong side or with wrong amount or omit to bring down the balance at all which make the trial balance disagreement.

  7. Committing errors in the trial balance
    The following errors, if committed in the trial balance itself, are disclosed by it:
    • Omitting to include a balance of an account in the trial balance
    • Entering the balance of an account in wrong side or with wrong amount in the trial balance
    • Obtaining wrong total of the trial balance

The agreement of the trial balance is not the complete evidence that the book of accounts is free from all accounting errors. It is because the trial balance cannot disclose all types of accounting errors. It means that there are certain types of errors that do not affect the agreement of the trial balance.

The following errors cannot be disclosed by the trial balance: -

  1. Errors of complete omission
    It occurs due to non-recording a transaction at all in the concerned primary book. These errors also occur due to omitting to post both accounts of a transaction in the ledger.

  2. Errors of commission
    It occurs due to wrong recording or posting a transaction. These errors occur due to the following reasons: -
    • If a transaction is recorded in the primary book including wrong amount
    • If a transaction is recorded in the primary book including wrong account
    • If a transaction is posted in wrong account

  3. Errors of principles
    It occurs due to wrong application of the Generally Accepted Accounting Principles (GAAP). The accounting personnel who are lacking the knowledge of principles and practices of accounting may record the transactions against these principles.

  4. Errors of duplication
    It occurs due to the recording of the transaction twice or more in the primary book. These errors also occur due to posting both aspects of the transactions against these principles.

  5. Compensating errors
    The errors which are compensated by committing other errors in the books of accounts are called compensating errors. Thus, two or more errors, which mutually compensate the effect of one another is called compensating errors.

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  • The errors which are committed by accounting clerks are called ______.

    clerical errors
    errors of omission
    compensating errors
    errors of principle
  • The errors committed by not recording a transaction either in the book of original entry or in the ledger book are called

    errors of omission
    errors of principle
    errors of commission
    compensating errors
  • The errors which are committed while recording or posting a transaction are called ______.

    errors of commission
    errors of principles
    errors of duplication 
    compensating errors
  • ______ refers to two or more errors which mutually compensate the effects of one another.

    Compensating errors
    Errors of commission
    Errors of principles
    Errors of duplication
  • ______ are those errors which occur by violating the basic principles of accounting.

    Errors of commission
    Errors of principle
    Errors of duplication
    Errors of omission
  • ______ are those errors which arise because of double recording.

    Errors of principle
    Errors of commission
    Errors of complete omission
    Errors of duplication
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