A journal entry that is made in order to correct an accounting error. Correcting entries are an adjustment to an accounting period’s retained earnings. Like any other entry, it has a debit and credit sides, and hence such entries are based on the double-entry accounting (and also, accrual accounting convention).

The need to add correcting errors arise from identification of such errors by double checking an entity’s trial balance and/ or conducting reconciliations, (e.g., accounting records against a bank statement).