When errors or omissions are discovered in the recording of transactions or the preparation of summary statements after the final accounts have been prepared and profits distributed by a partnership firm, how can the necessary adjustments be made?

By creating a separate account called "Profit and Loss Adjustment Account" to record the necessary adjustments.

Sometimes, after the preparation of final accounts and the distribution of profits among the partners, certain errors or omissions in recording transactions or preparing summary statements may be discovered. These errors or omissions can include missing interest on capitals, interest on drawings, interest on partners' loans, partner's salary, partner's commission, outstanding expenses, or changes in partnership deed provisions or accounting systems with retrospective effects. To rectify the impact of these errors or omissions, necessary adjustments can be made either through the "Profit and Loss Adjustment Account" or by directly adjusting the capital accounts of the relevant partners