1. Unit : 5 - Vouching
By Radhika
Visiting Faculty
J.H.Bhalodia College

2. Introduction
Routine checking is one of the primary function of an
auditor.
Another important function of an audit is Vouching.
It is the backbone of auditing.
The transactions recorded in the books of a/c are to be
compared with the supporting evidences and also to
check properly authenticated and approved.
Transactions will be vouch by its type eg. Cash, credit
purchase, credit sales.

3. Cont.
 Such credit transactions will be vouch by taking
the copies of invoices issued to the customers is
taken as a supporting documents.
 Mere checking and verification is not enough.
 It is equally important that the cash memos and
invoices are properly authorized.
 Hence the responsible person should sign such
vouchers .
 Thus, vouching is very important, because by
vouching the correctness and authenticity of
transactions are established.

4. Definition
“By vouching is meant the verification of the authority and
authenticity of transactions as recorded in the books of
accounts.” - B.B Bose
“Vouching consists of comparing entries in the books of account
with documentary evidence in support thereof.”
- Dicksee
“Vouching is a technical term, which refers to the inspection of
documentary evidence supporting and substantiating a
transaction.” -Ronald A. Irish

5. Meaning
Vouching is a process. While the documentary
evidence used for the purpose of vouching is a
‘Voucher’. Thus ‘vouchers are the documentary or
other evidences in support of transactions entered in
the books of accounts.
The process of comparing or tallying the entries
papering in the books of accounts, with supporting
evidence like cash memos, receipts and other
documents and correspondence is known as vouching.

6. Types of Voucher
1.Primary voucher
2.Secondary or Collateral Voucher

7. Characteristics
1. Examination of entries
- by documentary
- by other evidence eg. Vouchers, receipts,
counterfoils of check book and pay-in-slips, minute
books, correspondence
2. Such documentary supports and substantiate a
transaction.
3. Ensures correctness and
4. Important aspect of Auditing
5. Preliminary work of auditing

8. Objects
 To see that all transactions are correctly recorded
 To see that all transactions recorded are supported by the
documentary evidence
 To ascertain with the help of evidence that all transactions are
properly authenticated.
 To see that necessary vouchers relating to entries recorded in
books are with the client.
Thus, the purpose of vouching is not merely to verify that
the payments have been made, but to verify further that the
payment relates to the payments have been made, but to verify
that the payment relates to the business and is approved by
proper authority.

9. Importance
1. Reliable Examination
2. Examination of Original Evidences
3. Detection of errors at Initial Stage
4. Keeps the Auditor alert

10. Points to be
included
1. Serial No.
2. Date
3. Name
4. Address
5. Amount
6. Particulars
7. Approval and signature
8. Revenue stamp
9. Continuous vouching
10. Cancelling the voucher
11. Period
12. Entry in the books of a/c
13. List of missing vouchers

11. Vouching of
Cash transactions
Cash book is the most important of the books of
a/c for any business. The receipts and payments are
recorded in cash book. The cash balance on any day
can be known from cash book. The entries for receipts
and payments of cash are checked with reference to
various supporting documentary evidences.

12. Objects
 To ascertain that all the expenses and receipts are
shown under the correct book
 To ascertain that all the expenses and receipts
are shown under the correct heads
 To ensure there is no unauthorized or fraudulent
payments are made
 To verify that the closing cash bank balance are
correctly struck.

13. Vouching the
Receipt side of
Cash book
Vouchers
1. Opening Balance cash book of pre. yr
2. Cash Sales copies of cash memos
3. Cash Received from debtors receipts, bank pass book
4. Proceeds of Bills Receivable B/R book, pass book
5. Income for Interest and Dividend receipts, Counterfoils
6. Sale of Investments sale deed, receipt
7. Commission Received agreement,sale statement
8. Rent received Rent agreement,receipt
9. Proceeds from sale of scraped machinery plant register
10. Proceeds from sale of Fixed Assets receipt, tender

14. Cont.
11. Subscription received register of members
12. Insurance Claim insurance policy
13. Recovery of claims claim register,cash book
14. Receipts from sale hire purchase hire-purchase agreement
15. Royalty received contract of lease
16. Income of minimum rent lease agreement
17. IT refund return of income, app.
18. Dividend from Receiver receipt, passbook
19. Share Capital sh. App. & allotment
book, board’s resoltution
20. Debenture cash book, deb. App.,
board’s resolution
21. Issue of Right Shares cash book, AoA letter of
offer

15. Vouching of
the payment side of
Cash Book
i. Payments relate to the busi. Only
ii. The payment should relate to the year for which the a/c are
being audited
iii. All payments are properly approved and authenticated by
responsible officer
iv. Payments are correctly accounted for in the books of a/c
v. No payment should be left unrecorded
vi. Amount paid should be correct
vii. All payments supported by proper voucher
viii.Payment should be made to proper person
ix. Particulars should be tally with the books
x. The legality of payment should be verified

16. Vouching of
Subsidiary Books
1. Purchase book
2. Purchase return book
3. Sales book
4. Sales return book
5. Bills receivable book
6. Bills payable book
7. Journal proper

17. Journal proper
The transactions which are not recorded in the other subsidiary
books are entered in the Journal proper. The auditor should vouch
these transactions in the same manner as he does in case of cash
book transactions. He should see that each entry is supported by
supporting voucher.
a) Opening entries
b) Closing entries
c) Rectifying entries
d) Adjusting entries
e) Bad debts
f) Provision for bad debts and doubtful debts
g) Depreciation

18. Vouching
of Ledgers
Ledgers
Personal
Ledgers
Purchase
/Credito
rs
Ledgers
Sales/
Debtors
Ledgers
Imperson
al Ledgers
Real a/c
Nominal
a/c