What is the purpose of a trial balance in accounting?

The purpose of a trial balance in accounting is to ensure that the financial figures are balanced. It serves as a check to confirm that the total of all debit balances equals the total of all credit balances in the general ledger. This equality is vital as it indicates that the entries to the accounts have been made correctly and that the books are in balance. If there is a discrepancy, it signals that an error may have occurred during the recording process, which would need to be investigated and corrected before preparing financial statements.

This balancing function of the trial balance is critical for maintaining the integrity of the accounting system, thereby supporting accurate financial reporting. A trial balance is typically prepared at the end of an accounting period and is a key step in the accounting cycle, providing a foundation for further financial analysis and reporting.