Errors Not Disclosed Flashcards
What is CROPOC
- Commission
- Reversal of entries
- Omission
- Principle
- Original entry
- Compensating
What is an error of commission ?
Where an entry is made into the RIGHT type of account , but not the correct named account. Eg
Invoice for van maintenance is entered into computer maintenance
What is a reversal of entries ?
Where you would post the correct amount but in reverse. Eg
Instead of cr bank and dr wages we have CR WAGES and DR bank
To reverse we would post the original entry twice , once to remove and once to enter correct amount
What is an error of omission?
This is where we completely miss the entry , so we would need to enter it to correct
What is an Error of principle?
When an entry is made into the l wrong type of account. Eg an asset posted as an expense
To correct we would move it from the wrong account and enter it into the correct account
What is an Error of original entry ?
This is where the wrong figure was entered into both the CR and DR entry.
So there is no imbalance.
To fix this we would post the missing amount by CR bank DR account. Or CR account DR bank.
It would depend if the amount is more or less than what should have been
What is a Compensating error?
This is where 2 entries , one a DR and one a CR cancel each other out. To fix we would have to reduce the balance of one and increase the balance of the other by moving the amount between the two involved accounts
