Accounting

Errors of Omission

Errors of Omission

Errors of Omission

This error happens when a transaction is totally or partly omitted to be recorded in the books of accounts. The accountant’s major function is to record transactions of the business instantly after the transaction takes place, but sometimes the accountant forgets to record the transaction. The errors committed by not recording a transaction either in the book of original entry or in the ledger book are errors of omission. It can happen in the following ways: Errors in posting, Errors in Casting, Errors in carrying forward, Errors occurring during extraction of balances, etc.

Errors of omission may be classified as below.

Error of Complete Omission: This error happens when a transaction is completely omitted to be recorded in the books of accounts. For example, Goods purchased from Mr.ABC totally omitted to be recorded. This error does not affect the trial balance.

Error of Partial Omission: This error arises when only one aspect of the transaction either debit or credit is recorded. For example, a credit sale of goods to Mr.PQR recorded in sales book but omitted to be posted in Siva’s account. This error affects the trial balance.