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Avoid These Accounting Mistakes

Updated: Jul 4

Wednesday 26th June 2024

Data Entry Errors

Data entry accounting errors happen when incorrect information is entered into your records. Maintaining data integrity is crucial for accurate accounting. Common data entry mistakes include:

  • Entering an incorrect number

  • Entering numbers in the wrong order

  • Entering numbers instead of words, or vice versa

These errors can lead to a range of issues, from minor discrepancies to significant problems like underpayment or overpayment of a vendor. 

Omission Errors

An omission error, or false negative, occurs when a transaction, such as a purchase or sale, is forgotten and not forgotten and not recorded in the accounting records. 

Neglecting to enter a transaction undermines data integrity, whether it’s an employee’s salary or a crucial budgeting item needed for financial decisions. 

To ensure no entries are missing, follow this checklist:

  • Identify accounting records that don’t match bank statements

  • Look for discrepancies in the trial balance

  • Find mismatched checks and balance  

Duplication Errors

Duplication errors occur when an income or expense entry is recorded twice. 

These errors can significantly impact your accounting system or financial outcomes, depending on the duplicated entry. Anything from purchase order credits or debits to paychecks can be duplicated. 

Fortunately, duplication errors are relatively easy to identify. Signs include:

  • Entries appearing more than usual in the books

  • Mismatched checks and balances

  • Bank statements not aligning with your records 

Transposition Errors

Transposition errors occur when two digits are accidentally reversed during data entry. These errors can have serious financial consequences, such as paying an employee £8268 instead of £2868. 

The impact of transportation errors varies, but they can lead to significant financial losses for your business.

Transposition errors can be challenging to detect. Signs include:

  • Unusual discrepancies in your books

  • Mismatched checks and balances

  • Bank statements not aligning with your records 

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