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Using TurboCASH

 







CORRECTION OF ERRORS
ERRORS NOT REVEALED BY THE TRIAL BALANCE
  
Using a manual accounting system, you are more likely to find errors in the trial balance, e.g. where the trial balance does not balance. However, TurboCASH eliminates these errors, since TurboCASH balances batches before it is posted or updated to the ledger.

Although the Trial Balance is proof of the arithmetic accuracy of the accounting records, there may be errors in the Trial Balance (irrespective of whether you use a manual accounting system or any other computerised accounting system), which may not be revealed, since the Trial Balance is in balance. These errors are mainly caused by omissions and incorrect entries into the batches (subsidiary journals) or entries in the ledger after transactions have been posted or updated to the ledger.

These errors are usually corrected in the General Journal. The most common errors can be classified as follows:
  • Errors of complete omission

A complete transaction has been omitted and not entered in the respective batch. Subsequently, the transaction is not posted or updated to the ledger. Both the debit and the credit transaction have been omitted.
To correct this, you need to access the respective batch, enter the transaction and post or update the batch to the ledger.

  • Posting to the incorrect account
A debit side of a transaction was posted correctly as a debit to the general ledger, but to the incorrect account. For instance, an expense for petrol is incorrectly posted to the stationery account, etc.
To correct this, you need to access the General Journal batch, enter the transaction (e.g. Debit the petrol account and Credit the stationery account ) and post or update the batch to the ledger.

  • Errors of principle

A transaction is posted to the incorrect account in the accounting equation. An example would be if an expense for motor vehicles, such as petrol or repairs were posted to the motor vehicle assets, account, etc. These transaction entries are not correct according to the accounting principles. (e.g. since an expense is recorded as an asset).
To correct this, you need to access the General Journal batch, enter the transaction (e.g. Debit the petrol or repairs expense account and Credit the motor vehicle assets account) and post or update the batch to the ledger.

 

  • Errors of reverse posting

Transactions have been debited incorrectly as a credit, and the credit part of the transaction has been credited incorrectly as a debit. An example would be where petrol is purchased for cash, and the expense account is credited and the bank account debited incorrectly.
To correct this, you need to access the respective batch, cancel the transaction (e.g. Debit the petrol or repairs expense account and Credit the bank account). You then need to enter the transaction correctly in the respective batch. Both these transactions must be posted or updated to the ledger.


To eliminate or reduce the number of these errors, you may List a batch, check the transactions and edit it before the batch is posted or updated to the ledger.