VOUCHING &

VERIFICATION
 Meaning:
Vouching refers to the checking by the auditor of
documentary evidence supporting and
substantiating a transaction by the auditor.
Vouching is a careful examination of all original
evidences, such as invoices, bills, receipts,
requisition forms, quotations, statements, letters,
orders, agreements, minutes, contracts etc with a
view to ascertaining the accuracy of the entries
recorded in the books of accounts.
 Definition:
Taylor and Perry define vouching as, “the
examination of the evidences offered in
substantiation of the entries in the books, including
such examination of proof, so far as possible, that
no entries have been omitted from the books”.
 Vouchers:
A voucher is documentary evidence in support
of a transaction recorded in the books of
account. It is a written document or paper in
support of an entry in the books of account. It
is only through vouchers that the transactions
are recorded in the books of account.
Arthur W.Halmes defines a voucher as “any
documentary evidence in support of a
transaction”.
Thus, voucher is a document which evidences a
transaction or an entry in the books of
account.
Examples of vouchers:
 Cash receipts: Counterfoils of receipts issued,
carbon copies of receipts, contracts,
correspondence and letters from debtors
confirming the balance of their accounts.
 Cash payments: Original receipts from the
payees, invoices, cash memos, bills, demand
notes, salary books, wage sheets, contracts etc.
 Purchases: Invoices, goods inward book, copies of
orders sent, cash memos, bought notes,
correspondence etc.
 Sales: Copies of invoices, copies of orders
received, cash memos, sold notes, goods outward
book etc.
 Others: Debit notes, and credit notes, minute
books of meetings of directors or share holders.
Types of vouchers
Vouchers are mainly of two types. They are a) Primary
vouchers and b) Secondary vouchers.
 Primary vouchers: A primary voucher is written
evidence in original. Purchase invoices, cash memos for
goods purchased for cash, bank statements, confirmation
letters received from debtors and creditors for the
balance etc are a few examples of primary vouchers.
 Secondary or Collateral vouchers: When the original
vouchers are not available, copies of original vouchers
are produced in support of the entries in the books of
account. Sometimes subsidiary evidences are made
available with a view to removing suspicion and
satisfying the auditor. Such vouchers are called
secondary or collateral vouchers. Carbon copies of sales
invoices, copies of receipts issued to debtors, xerox
copies of agreements, sale deeds etc are few examples
of secondary vouchers.
Points to be noted while examining vouchers:
 As the vouchers constitute a very valuable link
between the transactions and their entries in
the books of account, each voucher should be
examined by the auditor with great care and
caution.
 All the vouchers should be consecutively
numbered, arranged serially in the order of
entries made in the books of account and are
properly filed.
 The auditor should see that the vouchers bear
the same number as given to the entries in the
books of account. This would help the auditor
to correlate a voucher with the relevant entry
in the books.
 He should see that each voucher is addressed
to the client’s organization at its normal
business address.

 He should see that every voucher is properly

dated and the date correspond to the date of
the transaction concerned and also the
period under audit.

 After the inspection of the vouchers, the

vouchers should be cancelled by the auditor
by means of a rubber stamp or by special
type of tick marks so that they may not be
produced again.
 The auditor should see that every voucher is certified
as correct by a responsible official who should put
down his signature on it.

 He should see that the amount of each voucher is

written both in words and figures. If there is any
difference between the two, he should investigate
about such difference.

 He should accept only those vouchers which are in the

printed form. In case any vouchers are issued on
ordinary pieces of paper, he should get such vouchers
duly certified by a responsible official.

 He should see that every voucher, which is a receipt

for cash payment of Rs.500 or more bears a revenue
stamp of rupee one.
 He should see that any alteration made in a voucher
has been duly confirmed by the maker and
responsible official issuing the voucher by their
signatures.
 He should not accept any vouchers which contain
alterations made by over writing or erasing without
any confirmation by the responsible official.
 If any explanation or clarification is required relating
to any voucher, the same should be noted in the
audit note book.
 He should not usually take the help of any members
of the staff of the client while vouching the entries
and checking the vouchers.
 There may be certain payments for which vouchers
may not be available, eg. Wages, petty expenses etc.
such payments should be checked with the wage
sheets and petty cash book.
 If there are any missing vouchers, a list of such
missing vouchers should be prepared by the
auditor and duplicates of such missing vouchers
should not be accepted by him as a matter of
routine. The auditor should seek reasons and
explanation for the loss of vouchers from the
client in writing. In any case, if the auditor is not
satisfied with the reasons and explanation for
any missing vouchers, he may state the same in
his report.
 While examining vouchers, the auditor should see
that they are properly entered in the proper
books of account.
 As far as possible, the work of vouching relating
to a particular period of a set of books should be
completed in one continuous sitting.