Steps to find the Errors in Trial Balance - QS Study
QS Study

Steps to find the Errors in Trial Balance:

If the trial balance does not tally, it means there are various errors in the books of accounts. The different steps which might be taken to find the errors include the following:

Step 1: Check the overall of the trial balance and determine the accurate amount of dissimilarity in the trial balance.

Step 2: The dissimilarity is halved to find out whether there is any balance of the similar amount in the trial balance. It is because, such a balance might have been recorded on the wrong side of the trial balance and hence, the dissimilarity is double the amount.

Step 3: If the second step fails to find the error, the dissimilarity in the trial balance is divided by 9. If it is divisible by 9 without any remainder, the mistake is due to transposition of figures. For example, transposition of figures represents writing of $ 780 for $ 870.

Step 4: See whether the balance of all ledger accounts including cash and bank balances are included in the trial balance.

Step 5: Ensure that all the opening balances have been appropriately brought forward in the current year’s books.

Step 6: If the dissimilarity in the trial balance is of big amount, the trial balance of the present year is compared with that of the earlier year and an account showing a big variation over the figure in the previous year’s trial balance should be rechecked.

Step 7: If the error is not detected by the above steps, care should be taken to analyze the

  • totals of all the subsidiary books
  • posting made from the journal and the subsidiary books to the relevant ledger accounts
  • balances extracted from the different ledger accounts
  • totaling of the ledger balances

Even after following the above steps, if the error could not be located, the whole of the prime entry must once again be checked and in case of need, the posting to the ledger should be rechecked thoroughly.