Accounting errors are classified broadly into two groups: those that affect the agreement of a trial balance and those that don’t.
Errors Leaving the Trial Balance Unaffected
A trial balance will not be affected if the total of all debit entries in the ledger is equal to the total of all credit entries. Therefore, if, despite an error, debit entries remain equal to credit entries, the trial balance will agree and hence fail to disclose the presence of an error.
Errors that do not affect the agreement of a trial balance are:
- Errors of omission
- Errors of commission
- Errors of principle
- Errors in original entry
- Complete reversal of entries
- Errors affecting the trial balance
- Compensating errors
Errors Affecting the Trial Balance
If an error results in unequal debit and credit entries in the ledger, the trial balance will fall out of agreement and thereby disclose the presence of the error. Such errors are usually the result of clerical oversight. The following are the common ones: