How Do You Define Vouching? Why Is Vouching Important For Conducting Audit Work?

10 Answers

Imran Afzal Profile
Imran Afzal answered
Vouching is the process of matching documentary evidence of an account balance or a transaction with the details recorded in accounting records and provides evidence as to the totality, validity or correctness of an account balance or a transaction. Actually this documentary evidence is called a voucher.    Whenever an auditor is asked to provide the evidence of the validity, completeness and accuracy of a transaction, the auditor gathers evidence that details of the account balance, transaction that has been recorded in the accounting records and usually it is supported by a documentary evidence i.e. Voucher. For example, the auditor acquires evidence relating to the validity, completeness and accuracy of an item such as sales recorded in a company's inventory records by vouching from details recorded in the inventory records (e.g. Name of the customer, date of the sale, items sold and the total amount of the transaction) to details on suppliers' invoices.    Vouching is necessary for every registered organization so that the record should be kept with the documentary evidence. Whenever auditor conducts the audit he should not face any problem and specially vouching is considered important because it prevents from frauds that could have been done by any one from with in the organization. Vouching is sometimes referred to as verification of the accounting records.
Nouman Umar Profile
Nouman Umar answered
At the time of conducting the vouching the following points must be borne in mind:
• In order to ensure that valuable time is not lost in vouching, the client should produce to the auditor all the vouchers arranged in the order in which entries appear in the books of account.
• The auditor must satisfy himself that the dates given on the vouchers which are recorded in the books fall in the year under review.
• Satisfaction must be made in respect of the head of account debited or credited from the availability documentary evidence.
• While examining the documentary evidence it should be carefully seen that the transaction pertains to the business. Care must be given to those vouchers which are in the personal names of the partners, managers, secretary and directors.
• Every voucher has been passed by the authorized official.
• Attention should also be paid to the point where the voucher bears proper revenue stamp.

• Complete notes should be taken in respect of such items as require further clarifications or evidence.
• Attention should also be paid to the amount to ensure that it agrees both in words and figures.
• Any alternation particularly in respect of the figure on the receipts and vouchers must be fully inquired into.
Anonymous Profile
Anonymous answered
"vouching refers to the documentation of the elements constituting a transaction"

or

"vouching refers to matching the evidence documents with each transaction in the records thereof , in order to check the reliability , accuracy and viability of the transaction"
Anonymous Profile
Anonymous answered
The Term Vouching means a carefull examination of all the original evidence such as invoices , statements, receipts, correspondence, minutes contracts etc. With a view to proving  the accuracy of the enteries in the books of account and to ascertaining as far as possible that no transactions have been omitted from the books. Vouching, in its broad sense, includes routine checking as well.
" Vouching " does not mean merely the inspection of receipts with the cash book, but includes the examination of receipts with the transactions of a business. Together with the documentary and other evidence of sufficient validity to satisfy an auditor that such transactions are in order , have been properly authorized and are correctly recorded in books."
Anonymous Profile
Anonymous answered
Voucher is a paper or document or bill or invoice which shows the evidence for any transaction in a business.
Shafqat Jilani Profile
Shafqat Jilani answered
American associate of Audit defines vouching as, "The systematic checking of documentary evidence with each individual transaction." Vouching is the first step, auditors take the start to process of audit in any business or non business concern.    Vouchers are individual documents, receipts, bills, invoices, or cash memos showing any transaction and its financial worth. Vouchers are first generated documentary support showing a business transaction.  As the first step in accounting procedure, vouchers are recorded in books of accounts i.e., journals, cash book on immediate basis and afterwards further books of accounts are maintained and accounts statements, trial balance and balance sheets are prepared.    During the process of Audit, its the duty of an auditor to check and verify each individual transaction of business recorded in the books of accounts. This checking of accounts or audit begins with the checking and matching of first record of original transaction with its documentary evidence i.e., voucher. In this process auditors picks all vouchers individually and matches the nature of transaction  in books of accounts. In this process auditors marks his vouching mark or on both voucher and transaction in the book. This process of comparing transaction and vouchers manually or on computers is called vouching.
Shalin Choksi Profile
Shalin Choksi answered
Vouching is the process by which an auditor of the company checks for evidence of the transactions that were made in the company during a financial year. The auditor has to submit evidence of his work that it is complete and no information has been left out. If any information has been left, the company can suffer huge problems and losses. It is the duty of auditor to gather evidence material.

For example, if the company buys raw material, the auditor has to see an evidence of the purchase by collecting the receipt of the purchase so that he can continue making a balance sheet or a list of assets. The information that the auditor collects has to be accurate and precise.

All the information can be obtained by viewing the company's dealing papers in a particular year. It is the duty of the company to maintain such papers.
Muhammad Abdullah786 Profile
The records maintained for accounts balance and evidence is a vouching process. All the companies must have all this records for auditing purpose. Vouching is the process of matching documentary evidence of an account balance or a transaction with the details recorded in accounting records and provides evidence as to the totality, validity or correctness of an account balance or a transaction. Actually this documentary evidence is called a voucher.    Whenever an auditor is asked to provide the evidence of the validity, completeness and accuracy of a transaction, the auditor gathers evidence that details of the account balance, transaction that has been recorded in the accounting records and usually it is supported by a documentary evidence i.e. Voucher. For example, the auditor acquires evidence relating to the validity, completeness and accuracy of an item such as sales recorded in a company's inventory records by vouching from details recorded in the inventory records (e.g. Name of the customer, date of the sale, items sold and the total amount of the transaction) to details on suppliers' invoices.    Vouching is necessary for every registered organization so that the record should be kept with the documentary evidence. Whenever auditor conducts the audit he should not face any problem and specially vouching is considered important because it prevents from frauds that could have been done by any one from with in the organization. Vouching is sometimes referred to as verification of the accounting records.
Nouman Umar Profile
Nouman Umar answered
In practice generally the job of vouching is done by two persons. A junior member of an audit staff alls out the particulars in respect to each of the entry appearing in the books such as data, particular, amount debited, credited and amount. The senior member compares the details called out with the documentary evidence produced to him to satisfy himself as to the genuineness of the transaction. In practice either of the following procedure is followed for identifying the act of vouching on the vouchers.

The senior puts his initials on the voucher.
A rubber stamp is put upon the voucher and upon its supporting documents.

The object of cancelling the documents by above manners is to ensure that the same documents are not produced again in support of other items.

If a transaction is satisfactorily considered to have vouched, distinctive tick is placed on the amount appearing in the book of original entry. If an item is considered to be insufficiently voucher for certain reasons a symbol Q is put on the amount appearing in the book of original entry and the relevant particulars of the vouchers which are insufficiently vouched are noted on the query list. So this is the complete procedure of the vouching.

Answer Question

Anonymous