Theoretical expressions for assessing the expected financial loss associated with the accuracy of the instrumentation and the associated probability in the presence of two and more gross errors have been developed in previous work. However, these expressions were given in a form of integrals without closed-form solutions. This article presents a generalized method to calculate the expected financial loss and the associated probability when two or more gross errors are present in a system. The application of financial loss calculation in the design and retrofit of a sensor network is illustrated in a simple example. (c) 2006 American Institute of Chemical Engineers AIChE J, 52: 3825-3841, 2006.