CHAPTER 12

VOUCHER SYSTEM

LEARNING OBJECTIVES:

The student should be able to:

1. Define voucher system.
2. Identify the journals used in vouchers system.
3. Differentiate voucher register from cash purchases journal.
4. Differentiate check register from cash payments journal.
5. Appreciate the importance of voucher system.

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In a small scale business organization especially the sole proprietorship, the owner is the

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one managing the business. He has the knowledge of all business transactions. He is the one
signing the checks so cash control is not a problem.

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In a large scale business organizations namely corporations, the owners or top

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management have no direct part in the disbursements process, so close control over this
function should be provided.
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The formalized system of internal control over disbursements called the voucher
system must be implemented.
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VOUCHER SYSTEM
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Voucher System is composed of records, methods and procedures employed in

verifying and recording liabilities and in paying and recording payments. A voucher system
uses two special journals namely 1) voucher register and 2) check register.
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The procedures applied in the voucher system to insure internal control over cash
disbursements:
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1. A voucher must be prepared fist for every transaction that involved payment.
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2. A voucher must be recorded in the voucher register.

3. A check will be issued upon payment.
4. A check must be recorded in the check register.

Voucher in general refers to any document that serves as evidence of authority to pay cash.
Example:
1. An invoice approved for payment
2. Evidence that cash has been paid (cleared check or check encashed from the bank)

Under the voucher system, voucher is a special form used in recording data pertaining
liability and the purpose of its payment. A voucher must be prepared first for every
transaction that involved payment.

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 An important characteristic of the voucher system is that a voucher must be prepared for
each payment. A check may be issued or paid at a later date depending upon the
circumstances and the credit terms.

Vouchers are customarily prepared by the accounting department on the basis of an

invoice or a memorandum or a contract that serves as evidence of disbursement.

Steps that must be done prior to the preparation of vouchers:

1. Verification of supporting documents. Compare the suppliers invoice with the
purchase order as to quantities, prices, specifications, kind and terms.
2. Comparison of the invoice with the receiving report to assure that the items billed
were received.
3. Verification of the arithmetical accuracy of the invoice.

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4. In cases of other payments such as rentals, security services and others, verify the
contract and other pertinent supporting documents.

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The vouchers must be numbered, preferably pre-numbered. After the preparation of
vouchers, these must be verified and approved by the designated officers or authorized

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personnel. Once the voucher is approved a check will be prepared and issued for payment.

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Under the voucher system, the account “Vouchers Payable” is used instead of
“Accounts Payable” but when preparing the financial statements the account “Accounts
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Payable” is preferable.
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A voucher must be recorded in the voucher register.

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After the approval of the vouchers by the authorized officers, these will be recorded
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in a journal called voucher register. It is similar to purchase journal. Under the voucher
system, a voucher register is used instead of a purchase journal.
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VOUCHER REGISTER
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Date Payee Voucher Terms PAID Purchases Vouchers SUNDRY

No. Debit Payable
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Date Check Credit Account Debit Credit

No. Title

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A check will be issued upon payment.

A check is a written instrument signed by the depositor (authorized designated

officer of the firm) ordering the bank to pay a specified sum of money to the order of a
bearer or specified person or entity.

There are three parties involved in a check.

1. Drawer – the one who signs the check
2. Drawee – the bank on which the check is drawn
3. Payee – the one whose order the check is drawn.

Account No. Account name Check No. 00101

0014-5100575-5 Rose Ann Borres

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Date April 15,2019

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PAY TO THE KIMBERLY SANTOS
ORDER OF P 20,000 .

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PESOS TWENTY THOUSAND PESOS ONLY .

ALLIED BANK
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. ROSE ANN BORRES .
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A check must be recorded in the check register.

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A check register is a modified form of the cash payments journal. It is a special

journal containing chronological and serial record of all checks issued. Each check issued
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is in payment of a voucher that has previously been recorded as an accounts payable in

the voucher register. The effect of each entry in the check register is a debit to Vouchers
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Payable and a credit to Cash in Bank.

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At the end of the accounting period, the total amount in the Voucher Register and
Check Register will be posted to the General Ledger. The balance in the Vouchers
Payable Account represents the unpaid vouchers. A file of the unpaid vouchers will
replace the subsidiary ledgers for accounts payable.

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 CHECK REGISTER
VOUCHERS CASH IN
DATE PAYEE CHECK VOUCHER PAYABLE BANK
NO. NO. DEBIT CREDIT

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NOTE: FORM VARIES
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APPLE ENTERPRISES
VOUCHER
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Voucher No. 01
Date: April 15, 2019
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PAYEE: KIMBERLY SANTOS

PARTICULARS
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Payment for Furniture P 20,000

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Officer Furniture 20,000

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Vouchers Payable 20,000

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Approved by: Verified by Prepared by:

________________ _____________ ______________

Check No. 00010 Date:_________ Amount:____________________

Received by: _________________________

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Exercise 12 – 1

____________________ 1. A special form used to record data pertinent to liability

and a particular of its payment.
____________________ 2. A special journal where the vouchers are recorded.
____________________ 3. A written instrument signed by a depositor ordering the
bank to pay a specified sum of money to the order or
designated person or entity.
____________________ 4. A special journal where checks are recorded
chronologically.
____________________ 5. The one who signs the checks.
____________________ 6. The one whose order the check is drawn.
____________________ 7. The bank on which the check is drawn.

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____________________ 8. A system which uses two special journals namely, the
voucher register and check register.

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____________________ 9. The detailed procedure adopted by an enterprise to
control its operations, the check and balance to safeguard
companies’ properties.

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____________________ 10. Serves as the substitute for the subsidiary ledger for

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Accounts Payable account.
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Exercise 12 – 2
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Bright Co. uses the voucher system. Selected transactions for the month of
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January, 2019 to be recorded to voucher register and check register are as follows.

Jan 2 Received an invoice from Jude Co. amounting to P5,000 for inventory.
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Term: 2/10, n/30. Voucher # 0001

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3 Received billing from Grand Enterprises for the office furniture worth, P3,500.
Term: 2/10, n/30. Voucher # 0002
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4 Purchased merchandise from LJ Company for P10,000 on a cash basis.

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Voucher # 0003. Issued check # 1050.

5 Paid P500 to Art Motion for advertising materials in January. Issued Check
#1051. Voucher # 0004
6 Paid P200 for freight charges to LBC Co. for inventory bought in Jan. 2.
Issued check # 1052. Voucher #0005
7 Paid Jude Co. for the amount due. Issued Check # 1053 for Voucher # 0001
8 Purchased inventory for P15,000 from Marsh. Term: n/30. Voucher # 0006
15 Paid salaries for the month P25,000 to employees. Issued check # 1054.
Voucher # 0007

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Exercise 12-3

Amor Company has the following transactions for the month of May, 2019.

May 1 Purchased office equipment from Analyn Co P20,000. Term 2/10, n/30.
Voucher #1

2 Purchased inventory for P50,000 from Janny Co. Term 2/10, n/30. Voucher
#2.

7 Purchased computer from Octagon Corp. P53,000. Term COD. Voucher # 3.

Issue Check # 02051.

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14 Paid Janny Co. for the amount due on Voucher # 2. Issued Check # 02052.

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15 Paid salaries of employee P18,000. Voucher # 4. Issued Check # 02053.

20 Bought supplies P5,400 from New Commercial Trading for cash.

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Voucher # 5. Issued Check # 02054.

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22 Bought inventory on account from Pretty Co. P75,000. Voucher # 6.
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25 Paid Analyn Co. for the amount due. Voucher # 1. Issued Check # 02055.

30 Paid electric bills P15,000 to PECO, Voucher # 7. Issued Check # 02056.

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31 Purchased inventory on account from Pretty Co. P28,000. Term n/30.

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Voucher # 8.
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Required:
1. Record the transactions using the voucher register and check register.
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2. List the unpaid vouchers and compare the total with the balance in the Accounts
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Payable ledger.

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