Error of principle
In accounting, error of principle means an entry posted to the wrong type of account in breach of an accounting rule — a repair capitalized as an asset, a loan receipt booked as revenue. The trial balance still balances; only review finds it.
- Layer
- Lexicon
- Defined in
- Lexicon
- Nearby
- 1
Not a rule
Bookkeeping convention — not codified. US GAAP governs recognition, measurement and presentation — not the mechanics a bookkeeper uses to get there. Anyone citing a standard for this word is citing the wrong thing.
Every citation in this system, with the text we read and the date we checked it, is in US GAAP and where these rules come from.
What it is not called
Each of these is a real word for a different thing. Using it here is what makes a product read as though it was built by someone who has not done the work.
- error of commission (right type, wrong account)
Components that render the terms it depends on
No component names this concept outright. Its definition is built out of terms that are named. These render trial balance, account, revenue, asset.
2Cards
Family spec3Payments
Family spec- AccountRegisterGL detail with a running balance.
- AccountPickerShows the normal balance. Blocks non-postable accounts.
- AccountTieOutEvery BS account, proven against its evidence.
- ChartOfAccountsHierarchy, statement mapping, unsupported-account flags.
- DimensionPickerEntity always required; renders what the account demands.
- RevenueWaterfallDeferred balance recognizing by future period.
- LeaseScheduleROU asset and liability on diverging curves.
10Receivables (AR)
Family spec13Metrics & analysis
Family specNearby in the catalog
No component names this concept outright. These are the ones in its part of the system, which is a weaker claim — but a component nothing links to is a component nobody finds.
9Accounting core (GL)
Family specTerms this one depends on
- Trial balanceEvery account's balance in two columns, proving that total debits equal total credits
- AccountA GL account in the chart of accounts. Always qualify when a bank account is meant.
- RevenueInflows or enhancements of assets, or settlements of liabilities, from delivering goods or services — recognized when control transfers, not when cash arrives
- AssetA present right of the entity to an economic benefit (FASB CON 8 ¶E16)
Also in Core ledger
Defined in Lexicon. This page is generated from that document, so the two cannot disagree.