Accounting · Rectification of Errors
A scheduled commercial bank operating in India is processing a complex inter-branch transaction during the year-end closing of March 2025. A Mumbai branch mistakenly debited a corporate customer's CC account for a sum of 5,000,000 rupees intended for a vendor payment in Delhi. The error was discovered after daily batch processing but before finalization of the annual accounts. According to the guidelines for rectification of errors in a core banking environment, what is the most appropriate method to rectify this discrepancy?
Verified Solution4 OptionsUpdated: October 2026👁️1 View
Share:
- 1Pass a rectification entry by debiting the correct account and crediting the corporate customer account while ensuring a clear narration is provided for the reversal.✓
- 2Instruct the Delhi branch to credit the vendor and debit the Mumbai branch without passing any entry in the Mumbai branch books.
- 3Delete the original transaction from the database directly using system administrative rights to avoid any ledger impact.
- 4Pass a reverse entry in the Mumbai branch by crediting the corporate customer account and debiting the inter-branch adjustment account for 5,000,000 rupees.
Correct answer
Pass a rectification entry by debiting the correct account and crediting the corporate customer account while ensuring a clear narration is provided for the reversal.
Download Single Question PDF
Save this question and verified answer as a clean study sheet with live clickable link.
👥
Share with Friends & Study Groups
Challenge your peer aspirants on WhatsApp or Telegram to solve this question!
Online Test Series
Start Free Mock Test →Preparing for Accounting?
Practice full-length mock tests with real exam timers, instant score analysis, and all-India ranking.
Chapter Practice
Practice Rectification of Errors MCQs →Want more practice questions on Rectification of Errors?
Solve complete topic-wise tests with detailed solutions on GkGet.
Related Practice Questions
Recommended practice questions in Accounting · Rectification of Errors