January 29, 2022


Accounting + Finance Blog

Key Errors that don’t affect trial balance: Error of Commission

Key Errors that don't affect trial balance: Error of Commission

In the previous article, error of principle was explained. This article takes a look at another error which might occur in the books of account of a firm and still it won’t affect the balance in a trial balance. Here, we are examine error of commission.

Definition of error of commission

It is defined as an error that occurs in the wrong personal account in a business books of accounts.

You can also define it as mistakes in the wrong account of persons in a business’ books of accounts.

Key Explanations

To know if it is an error of commission, the mistake must be in the wrong personal account. To help you understand better, let’s explained what it means by personal account.

An account of persons are accounts for names of real and artificial persons. You and I are real persons. So, Thompson account in the sales ledger (that is, account receivables) is a personal account. Same with Funke account in the Purchases ledger (that is account payables).

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Names of artificial persons are names of companies. Bola holdings account in account Receivables is an account of persons. So is Zenith bank account in the books of account of the firm.

How do error of commission occurs in the Account books?

To illustrate, assume a staff in a business wants to record a receipt of money for sales of goods through Zenith bank. But on recording it in the books of accounts, he or she mistakenly records it in the bank’s Access Bank account. This is an error of commission.

Another illustration is when the staff records a transaction that should be at Jeremiah O. James a/c in Jeremiah E. James account. Another error might have occurred when a staff records a payment for cash by Michael Daniels a/c but posted in error to Tobi Collins account.

How to correct an error of commission

When this error occurs, the usual task is to reverse the amount to the correct personal account. An example will explain this further.

Example one:

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A staff at Ali Fashions wrongly posted 97,400 Naira into the business’ First Bank a/c (in the accounting books of the firm) for goods sold to a customer that was paid through a bank transfer in the firm’s UBA a/c.


To correct the error. The first task is to understand the mistake that took place. Here, the staff posted a sales transaction wrongly to First bank account in the books of the firm. Whereas, the transaction occurred in UBA account.

When the error occurs, the staff has posted a debit to First Bank a/c and a credit entry from Sales a/c with the amount. The mistake does not affects Sales account. Therefore, to correct the error, a reversal from First bank a/c to UBA account will be done using a journal entry.


Dr: UBA account
Cr: First Bank account.

By a credit of First Bank account, the 97,400 Naira will cancel out. And the transaction will be in the right account which is the UBA account. Note that the Journal serves as a book of first entry. And the correction will be done in the accounting system of the firm.

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Why does this error not affect trial balance?

Note that the correct double entry was passed. That is,

Dr: First Bank a/c and
Cr: Sales a/c

Also, the amount was entered correctly in both accounts. Therefore, the error will not affect the trial balance of the firm.


You can learn more about other types of errors. In this lesson, however, you have learnt about error of commission and how to correct such mistakes by reversing the entry to the correct account.