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Chapter 3 vouching
This document discusses the process of vouching in accounting. It defines a voucher as documentary evidence that supports an accounting transaction. The main objectives of vouching are to detect errors and frauds, verify the accuracy of accounts, and ensure that all transactions are authorized. When vouching, the auditor examines documents to check for proper evidence of transactions, verification of amounts and time periods, and that the transactions are related to the business. Vouching of source documents and ledger accounts is a key part of the auditing process, as it helps validate the accuracy of financial records.
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Chapter 3 vouching
- 1. Chapter 3 Vouching MANU HNATESH MBA,M.Com. BMSEAC manu@bmsec.ac.in
- 2. • Meaning OfVouching Voucher is known as the evident for the support of a transaction in the books of account. It may be bill, receipts, requisition form, agreement, decision, bank paying slip etc. MANU H NATESH MBA,M.Com. BMSEAC manu@bmsec.ac.in
- 3. Objectives of vouching •Objectives Of Vouching Main objective of vouching is to find out the regularity or irregularity of transactions, frauds and errors. Regularity means maintaining record and performing the work compliance with the rules, regulation and law. But irregularity means doing the work crossing to the line of rules, regulation and laws. Some of the major objectives of vouching are given below: • 1. To Detect Errors And Frauds • 2. To Know The Truth Of Account • 3. To Find The Unrecorded Transactions • 4. To Know That All The Transactions Are Authorized • 5. To Know That Only The Business Transactions Are Recorded MANU H NATESH MBA,M.Com. BMSEAC manu@bmsec.ac.in
- 4. Purpose of vouching •Proper evidence • Right period • Correct amount • Capital and revenue analysis • Purchase for business • Accuracy • Postings • No errors, no fraud • Cash at bank, cash balance • reporting MANU H NATESH MBA,M.Com. BMSEAC manu@bmsec.ac.in
- 5. Importance 1. Vouching IsThe Backbone Of Auditing 2. Vouching Is The Essence Of Auditing 3. Vouching Is Important To See Whether Evidences Are Correct Or Not MANU H NATESH MBA,M.Com. BMSEAC manu@bmsec.ac.in
- 6. Principles of vouching •Arranged voucher • Checking of date • Checking of authority • Cutting or change • Compare words and figures • Transaction relation to business • Case f personal vouchers • Checking of account head MANU H NATESH MBA,M.Com. BMSEAC manu@bmsec.ac.in
- 7. Contd…. • Revenue stamps •Case of cancelled vouchers • Minutes book • Important dates • By laws • Agreements • Deed or mortgage MANU H NATESH MBA,M.Com. BMSEAC manu@bmsec.ac.in
- 8. Voucher meaning • Avoucher refers to any documentary evidence in support of an entry made in the books of accounts • According to Arthur W Holmes “ a voucher is documentary evidence in support of a transaction”. Examples : cash memo, bank pay in slip, minutes of a meeting, debit notes, credit notes MANU H NATESH MBA,M.Com. BMSEAC manu@bmsec.ac.in
- 9. Kinds of vouchers •Primary vouchers ex: cash memo for cash purchases • Subsidiary(collateral) vouchers ex: along with receipts of credit demand sales invoice or order copy MANU H NATESH MBA,M.Com. BMSEAC manu@bmsec.ac.in
- 10. Other types • Journalvoucher MANU H NATESH MBA,M.Com. BMSEAC manu@bmsec.ac.in
- 11. • Template voucher MANUH NATESH MBA,M.Com. BMSEAC manu@bmsec.ac.in
- 12. • Adjustment voucher •Regular Journal voucher • Reversal voucher • Single payment voucher MANU H NATESH MBA,M.Com. BMSEAC manu@bmsec.ac.in
- 13. Contents of voucher •Name • Date • Serial number • Revenue stamp • Amount • Signature • Printed form MANU H NATESH MBA,M.Com. BMSEAC manu@bmsec.ac.in
- 14. Vouching of cashbook Points To Be Considered While Vouching Of Cash Transactions 1. Responsible officer for cash received and authority to sign check should not be given to the cashier and a copy of counterfoil should be kept for record of office. The receipts should be numbered serially. 2. All the receipt of cash should be recorded in the cash book. 3. Amount of cash received should be deposited into bank daily. 4. The cashier should not have any control over ledgers. 5. Drawer of check should present it to responsible officer to sign. 6. All unused receipt books and check books must be kept under lock. 7. System for recording cash sales and miscellaneous income should be different. 8. All the payments except petty cash expenses must be made by check. MANU H NATESH MBA,M.Com. BMSEAC manu@bmsec.ac.in
- 15. Specific items tobe examined • Cash purchase • Payment to creditors • Bills payable • Purchase of plant and machinery • Purchase of land and building • Investments • Payment of salaries, wages • Interest on loan • Payment of dividends • Payment of director’s fees • Payment of commission • Entertainment expenses • Freight and octroi • Postage expenses • Bank charges • Payment of insurance • Dishonored bills receivables • Payment of bonus MANU H NATESH MBA,M.Com. BMSEAC manu@bmsec.ac.in
- 16. Vouching of ledgerbooks • Petty cash book • Purchase book • Purchase return book • Sales book • Sales return book • Bills payable book • Bills receivable book MANU H NATESH MBA,M.Com. BMSEAC manu@bmsec.ac.in
- 17. MANU H NATESHMBA,M.Com. BMSEAC manu@bmsec.ac.in