Key Takeaways
- Voucher documents and authorizes financial transactions.
- Includes supplier info, amounts, and approval signatures.
- Ensures payment approval and prevents duplicate payments.
- Supports audits by verifying transaction authenticity.
What is Voucher?
A voucher is a document that serves as proof of a financial transaction, verifying that a payment or liability has been recorded and authorized within a company’s accounting system. It acts as internal evidence supporting entries in the ledger and helps control disbursements to vendors or service providers.
By documenting each payment, vouchers ensure transparency and accountability in financial operations, linking invoices, purchase orders, and payments in a structured process.
Key Characteristics
Vouchers have distinct features that make them essential for financial record-keeping and control.
- Authorization: Each voucher requires approval from an authorized person before payment, preventing unauthorized disbursements.
- Documentation: They include invoice details, payment amount, supplier information, and related supporting documents.
- Audit Trail: Vouchers provide a verifiable sequence of transactions, important for audits and internal reviews.
- Accounting Integration: Vouchers include ledger account numbers and facilitate accurate postings, often reflected in tools like a T-account.
- Control Mechanism: Serial numbering and filing systems help prevent duplicate payments and support fraud prevention.
How It Works
The voucher process begins once a company receives an invoice matching a purchase order. The voucher is created to verify the goods or services were delivered and the amounts are accurate.
After verification, an authorized official approves the voucher, which is then recorded in the voucher register. This register replaces traditional purchase journals and ensures that payments are only made against approved vouchers. Once payment is completed, the voucher is marked "Paid" and filed for future reference. This process safeguards the company’s assets and streamlines payment workflows.
Examples and Use Cases
Vouchers are widely used across industries to manage payments and maintain internal controls efficiently.
- Airlines: Companies like Delta rely on vouchers to manage vendor payments and track service contracts.
- Banking: Financial institutions such as Bank of America use vouchers to control disbursements and document liabilities in their accounting systems.
- Asset Security: Businesses often store physical vouchers or related documents in a safe deposit box for secure preservation and audit readiness.
Important Considerations
When using vouchers, ensure proper authorization protocols are strictly followed to prevent fraud and errors. Maintaining a well-organized voucher filing system supports audit processes and financial transparency.
Additionally, understanding related terms like D&B reports can help assess vendor credibility before issuing payment vouchers, further strengthening financial controls.
Final Words
A voucher ensures every payment is properly authorized and documented, strengthening your financial controls. Review your current voucher process to confirm it includes thorough verification and approval steps for accurate record-keeping.
Frequently Asked Questions
A voucher is a document that proves a financial transaction has occurred and serves as supporting evidence for accounting entries. It acts as an internal authorization to ensure payments made by a company are appropriate and authorized.
A voucher usually contains supplier details, invoice and payment dates, the payable amount, transaction description, account numbers, approval signatures, and serial numbers for audit control. Supporting documents like invoices and purchase orders are often attached.
The process starts with creating a voucher after matching a vendor invoice to a purchase order, followed by verification of goods or services received. Then, an authorized official approves it, it’s recorded in the voucher register, and finally, payment is made and documented.
Vouchers help ensure every payment is authorized and justified, reducing risks like theft or embezzlement. They provide a clear record of how company resources are used and help maintain financial integrity.
During audits, vouchers allow auditors to verify that all purchased goods or services were actually received and paid for. They serve as organized, reliable evidence of financial transactions.
The voucher register is a record where all approved vouchers are logged, replacing the traditional purchases journal. It helps track payment approvals and ensures proper bookkeeping.
Yes, vouchers often specify valid early payment discount terms. This helps companies take advantage of discounts by ensuring payments are made within agreed-upon timelines.
