The way the question was posed, if the water entering through the hole never came inside the boat then nothing changes...the boat will not sink, water has to be coming into the boat to make it sink, also if it is made of wood or glass, it will only fill with water if the water stays in the boat, it will not sink. A steel displacement hull would sink but again only if the water stays inside the hull. Another thing to throw in to the mix is that if the boat is moving and the bungs are taken out of the transom the boat will not sink either. This is all assuming that it is a small hole as it must be for the water to "squirt" over the side..
Mick