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Voucher is a piece of evidence, which proves that a certain event or transaction is carried out. Voucher can be in three different forms. These are mentioned below:

  • Proof: Vouchers are a proof that specific transaction has been carried and the audit trail of transaction is available in the relevant books of the entity
  • Written record: Voucher is often a written record for an expense, or a completed transaction, and it is properly recorded
  • Written authorization: Voucher is often a written authorization that establishes the fact that voucher holder is entitled to the amount of the money mentioned on the voucher (in case of a cash voucher) or voucher holder is entitled to spend the mentioned amount of money on the future expenditures (in case of a credit voucher)

Types of vouchers

Many types of vouchers are used in accounting. These are used for recording the transactions as a source document. Following are some of the types of these vouchers:

  • Payment: These types of vouchers is a proof of payment by cheque or cash
  • Receipt: These vouchers help in the recording of the receipts. If the payment is received from a customer, then a voucher will be prepared as a proof to the transaction
  • Purchase: This voucher is made as a proof to the purchase. This helps in determining whether the entity has actually carried out the purchase
  • Sales: These vouchers are a proof of the sale of inventory to the customer and help in establishing that sale is not fictitious
  • Contra: These vouchers are designed for passing the contra entries
  • Journal: These are the vouchers when the account is neither a cash nor cheque
  • Adjustments voucher: Changes in the business stock or any other changes are accounted by adjustment vouchers
  • Loss statements: These vouchers are made to determine the losses incurred

Why vouchers are necessary

Vouchers are necessary because they are a source document and a proof to every transaction that has taken place in the business premises. If every transaction of the business were recorded, it would mean that there is a voucher available as a proof to that transaction. When the accounts of the company are audited, these vouchers play an important role and help the external auditor in gathering audit evidence

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