Errors of Omission

Errors are a part of any recording process and accountancy also has a fair share of errors that are unintentionally caused at the time of recording journal entries.

The errors made in recording are known as accounting errors and it is very essential for the business to know the types of accounting errors that can impact the business.

One such error that we are going to discuss is the error of omission. It falls under the type of clerical errors, which is one of the two major types of accounting errors, the other type being errors of principle.

Errors of omission results when the accountant forgets to enter a transaction in the books. It may be an invoice or a sales receipt.

Errors of omission can be further classified into two types

1. Complete Omission

2. Partial Omission

Let us know more about these in detail.

Complete Omission: In the case of complete omission, it happens that the transaction that has taken place is completely omitted and is not present in any of the records of the company. For e.g cash received is not recorded in the cash book.

Complete omissions are a little tricky to determine, it can be determined when the statement of accounts are prepared and shared with the debtors or creditors.

It does not have an impact in the trial balance as both debit and credit entries are not recorded.

Partial Omission: Partial omission happens when a transaction is recorded in the books but is not subsequently recorded in the ledger. It can happen during the recording of transactions in any subsidiary books.

For example: Proprietor of the business takes Rs.5000 from the business account, but fails or forgets to record the same in the books.

Errors of omission are difficult to determine, in cases of partial omission checking the debit and credit records can help in assessing the omission, while in case of complete omission, bank reconciliation can be helpful.

The most common cause of these errors are due to loss of documentation of the transactions. Timely updates in the records can reduce such errors.

This concludes our article on the topic of Errors of Omission, which is an important topic in Accountancy for the Class 11 Commerce students. For more such interesting articles, stay tuned to BYJU’S.

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