Transposition Error: Definition, Causes, and Consequences

This is certainly applicable when prescribing drug dosages to patients with serious health conditions. A bookkeeper at a company enters $2400 for a purchase when the actual figure stands at $4200. This bookkeeper has years of experience and an exceptional eye for detail. GLAnalytics software solution is a cloud based, highly secure, proactive employee error and fraud detection system. This word is most often used of swapping sounds, but the OED defines it as “The transposition of sounds or letters in a word, or (occas.) of whole words or syllables; the result of such a transposition”. Someone going unpaid will probably result in an angry employee phone call, but finding the error before payroll gets completed should be your main goal.

  • Simple bookkeeping methods and personal reminders can help but the most effective way to detect these errors is with cloud-based data analytics.
  • The
    most common way for characters to be
    transposed is when a user is touch
    typing at a speed that makes them
    input one character, before the other.
  • I get through them as fast as possible because my coworker said there are powdered doughnuts in the kitchen.
  • Trial balance errors cause inaccuracies on your balance sheet and income statement.

You can do this visually, but most accounting software has tools to automate the process. Double-entry bookkeeping can also help to reduce transposition errors. For example, transposition errors in accounting, when a bookkeeper manually enters data into a ledger, they may, by mistake, incorrectly transfer information from an invoice into a balance sheet.


In this tragic case, the crew set the aircraft to descend at 3,300 feet per minute instead of the 3.3 degree angle they meant to enter. As mentioned in the intro, data transposition errors (a.k.a “fat finger moments”) can lead to more treacherous consequences in high-risk industries. The incorrect data gets processed without any other staff members noticing. Weeks later, a review of inventory reveals a gap between the stated expenses on record. Only then does it become clear that incorrect data has been entered.

control for transposition errors

Entry reversal resembles that of a principle error and can easily be confused for one, however, entry reversal is the result of entering data in the wrong direction. The best way to correct a transposition error is to make a debit entry to cash by the amount of the error and a credit entry to the account with the incorrect balance by the amount of the error. This can have an impact on the income statement and indicate inconsistent and inaccurate financial incorrect records. Moreover, the incorrect information on tax forms, shareholder reports and other accounting documents can give a false perception of fraudulent activities. Say you recorded a client check for $560 in your accounting software, but the actual check amount is $650.

What is your current financial priority?

Click here to read our full review for free and apply in just 2 minutes.

  • Mixing numbers up in everyday life – such as dialing the wrong phone number – may cause nothing more than a minor disruption.
  • In this type of bookkeeping, all entries are made twice, making it easier to spot discrepancies.
  • The potential impact of a data entry error can vary from something minor like a spelling error to a major mishap such as underpayment or overpayment of a vendor.
  • Nevertheless, transposition errors can lead to a never-ending list of problems that are difficult to correct.
  • At least monthly, open your company’s trial balance to make sure there isn’t a difference between the debits and credits.

If you’re using the wrong credit or debit card, it could be costing you serious money. Our experts love this top pick, which features a 0% intro APR for 15 months, an insane cash back rate of up to 5%, and all somehow for no annual fee. Implement a system to catch and correct errors promptly to avoid creating more problems for yourself. This is the above example showing the detail of the algorithm generating the check digit (dashed blue arrow) and verifying the number 572 with the check digit. It’s called a ‘transposition’ error because it involves the ‘transposition’ or ‘swapping’ of two numbers. For example, if ’34’ was mistakenly written as ’43’ , this would be a transposition error.

Leave a Reply