Disadvantages or Limitations Of Double Entry System

Following are the disadvantages or limitations of double entry book-keeping system

a)No record of all business activities: Under this system, all the business activities cannot be recorded. It records only the financial transactions and ignores non-financial qualitative activities of business.

b)Difficulty in corrective actions: Under double entry system, financial statements are prepared after the expiry of the accounting period.
Therefore, it is difficult to use corrective measures within the accounting period.

c)Expensive: This system involves the maintenance of a number of account books. So, it is quite expensive.

d)Complicated: This system requires strict adherence to the principles or the rules of accounting. Therefore ,accounts cannot be maintained without adequate knowledge and training under this system.

e)Failure to disclose some errors: In this system, only arithmetical accuracy of the accounts is checked by preparing a trial balance. But there are some errors which cannot be disclosed under this system. For examples, complete omission of a transaction, recording of wrong amount etc.