A trial balance checks that total debits equal total credits — but agreement does not guarantee the books are error-free. Some errors slip through undetected.
This guide explains the types of accounting errors and which ones a trial balance catches.
What is trial balance errors?
Errors that affect one side of an entry unbalance the trial balance and are caught. Errors that affect both sides equally — like recording a transaction in the wrong account — do not unbalance it and go undetected.
Understanding these helps accountants review beyond the trial balance.
Errors NOT revealed by a trial balance
- Errors of omission (transaction not recorded at all)
- Errors of commission (right amount, wrong account of same type)
- Errors of principle (capital vs revenue misclassification)
- Compensating errors (two errors cancelling out)
Frequently asked questions
Does a matching trial balance mean no errors?
No. Several error types — omission, principle, compensating — do not unbalance the trial balance.
What is an error of principle?
Recording an item against a wrong class of account, such as treating a capital expense as a revenue expense.