SingaporeAccountingSyllabus dot point

Which kinds of error leave the trial balance still agreeing, and how do they differ from errors that throw it out?

Identify the errors that do not affect the agreement of the trial balance

A focused answer to the O-Level Principles of Accounts outcome on errors. The six errors that do not affect trial balance agreement - omission, commission, principle, original entry, reversal and compensating - with examples.

Generated by Claude Opus 4.88 min answerUpdated 2026-06-06

Reviewed by: AI editorial process; not yet individually human-reviewed

Have a quick question? Jump to the Q&A page

Jump to a section

What this dot point is asking
The answer
Examples in context
Try this

What this dot point is asking

SEAB wants you to identify the errors that leave a trial balance still agreeing. These are the errors that escape the arithmetic check. The central insight is that the trial balance only tests whether total debits equal total credits; any error that keeps those two totals equal will slip through, even though the books are wrong.

The answer

The six errors that do not affect agreement

There are six classic errors that leave the trial balance balanced:

Error	What happens	Example
Omission	A transaction is left out entirely	A credit sale is never recorded
Commission	Right type of account, wrong account	Rent debited to the Insurance account (both expenses)
Principle	Wrong class of account	A van debited to Purchases (asset treated as expense)
Original entry	Wrong amount on both sides	A $\$ 540 $sale entered as$ \ $450$ in both accounts
Complete reversal	Debit and credit swapped	Cash sale credited to Cash and debited to Sales
Compensating	Two errors cancel out	Sales overcast $\$ 100 $and Rent overcast$ \ $100$

In each, the debit still equals the credit (or two errors offset), so the totals match.

Why each one slips through

Omission - both the debit and the credit are missing, so neither total changes.
Commission - an equal debit and credit are still made; only the named account is wrong.
Principle - again equal amounts; only the class of account is wrong.
Original entry - the wrong figure is used on both sides, so they still match.
Complete reversal - both entries are made, just on the wrong sides, so totals are unaffected.
Compensating - one error inflates the debit side and another inflates the credit side equally.

The contrast: errors that do throw it out

By contrast, a one-sided error (a debit with no matching credit), an entry posted twice on one side, or a wrong addition of one column will make the totals disagree. Those are the errors a trial balance does catch, and they are dealt with using a suspense account.

Worked example

For each, name the error and explain whether the trial balance still agrees. (1) A $\$ 200 $purchase from Goh was completely omitted. (2) Wages of$ \ $300$ were debited to the Rent account. (3) New office furniture $\$ 1,000 $was debited to Purchases. (4) A$ \ $680$ receipt was entered as $\$ 860$ in both the cash book and the customer's account.

Step 1: The omitted purchase

Error of omission. Neither the debit (Purchases) nor the credit (Goh) was made, so both totals are unchanged. The trial balance still agrees.

Step 2: Wages debited to Rent

Error of commission. A debit of $\$ 300$ was still made, just to Rent instead of Wages, with the correct credit. Both totals are unchanged, so the trial balance still agrees.

Step 3: Furniture debited to Purchases

Error of principle. A non-current asset was treated as an expense. The debit and credit are still equal, so the trial balance agrees, but profit and assets are misstated.

Step 4: $\$ 680 $recorded as$ \ $860$ both sides

Error of original entry. The wrong amount was used, but on both sides, so the debit still equals the credit. The trial balance agrees.

All four escape the trial balance, which is why other checks are needed to find them.

Examples in context

Example 1. A misclassified asset hides in plain sight. A firm debits a $\$ 5,000 $machine to Purchases. The trial balance agrees perfectly, but expenses are$ \ $5\,000$ too high (so profit is understated) and non-current assets are $\$ 5,000$ too low. This error of principle shows why a balanced trial balance is not proof that profit is right.

Example 2. Two wrongs that look right. A bookkeeper overadds the Sales account by $\$ 50 $and, separately, overadds the Wages account by$ \ $50$ . The extra credit and the extra debit offset exactly, so the trial balance balances. These compensating errors are the hardest to spot precisely because nothing looks out of place.

Try this

Q1. Name the error: a $\$ 400$ payment to a supplier was debited to the wrong supplier's account. [1 mark]

Cue. Error of commission (right type of account, wrong account).

Q2. Explain why an error of original entry does not unbalance the trial balance. [2 marks]

Cue. The wrong amount is entered on both the debit and the credit side, so the two totals remain equal.

Q3. Give one example of a compensating error. [2 marks]

Cue. For example, the Sales account is overcast by $\$ 100 $and the Rent account is overcast by$ \ $100$ , so the extra credit and extra debit cancel out.

Exam-style practice questions

Practice questions written in the style of SEAB exam questions on this dot point, with worked answer explainers. The year tag is the paper they imitate, not the source.

Original6 marksName the type of error in each case: (a) a credit sale to Lim was completely left out of the books; (b) rent paid was debited to the Insurance account; (c) the purchase of a delivery van was debited to the Purchases account; (d) a

\

540

sale was recorded as

450

in both accounts.

Show worked answer →

Case	Type of error	Why
(a) Credit sale left out entirely	Error of omission	The whole transaction was never recorded
(b) Rent debited to Insurance	Error of commission	Right type of account (expense), wrong account
(c) Van debited to Purchases	Error of principle	Wrong class of account (asset treated as an expense)
(d) $\$ 540 $recorded as$ \ $450$ both sides	Error of original entry	Wrong amount entered, but equally on both sides

Markers reward the correct named error for each and a brief reason. Note that all four leave the trial balance still agreeing because the debit and credit remain equal.

Original5 marksExplain why an error of principle and a compensating error both leave the trial balance in agreement, and give an example of each.

Show worked answer →

An error of principle records a transaction in the wrong class of account, for example debiting the purchase of equipment (a non-current asset) to the Purchases (expense) account. The debit and credit are still equal in amount, so the trial balance totals still match, even though the equipment is wrongly classified.

A compensating error is two separate errors that cancel out. For example, the Sales account is overcast (overadded) by $\$ 100 $and the Rent account is also overcast by$ \ $100$ . One inflates the credit total and the other inflates the debit total by the same amount, so the trial balance still agrees.

Markers reward correct definitions and examples, and explaining that in both cases the equality of total debits and total credits is preserved.