This article explores the objectives of vouching in auditing and highlights its importance in the auditing process. When it comes to auditing, vouching plays a crucial role in ensuring the accuracy and reliability of financial statements.
Objectives of Vouching in Auditing For Auditors.
- PROPER EVIDENCE
The main purpose of vouching is to see that proper evidence is available for each entry. The signature is an evidence that the document has been checked.
- PROPER AUTHORITY
Another purpose of vouching is to see that proper authority is levied on each transaction. If there is no signature of relevant officer, the voucher is not acceptable.
3. PERIOD
The object of vouching is to see that the date of vouchers relate to accounting period. The adjustment in books must be made on the basis of current year record of Transaction.
4.CORRECT AMOUNT
The object of vouching is to check that correct amount has been recorded in the entry.
5.CAPITAL AND REVENUE ANALYSIS
- Another object of vouching is to make the difference between capital and revenue items: Expenditures of ordinary nature are treated as revenue and expenditures which give the benefit to the business for long period are treated as capital expenditure.
6.PURCHASES
The object of vouching is to see that purchases relate to business. The private purchases must not be recorded as business purchases.
7.ARITHMETICAL ACCURACY
The purpose of vouching is to check that proper accuracy in books of accounts is maintained. For this purpose, the auditor can check total, sub totals and postings. . .
8.POSTING
Auditor can also vouch the posting of totals from ^journal to the ledgers. He can see through the vouchers that posting are complete and correct.
9.NO FRAUDS
The object of vouching is to check that no fraudulent payments are made Normally the frauds are committed when the minds of employees and customers are matched The auditor can vouch the entries to disclose such frauds.
10.CASTINGS
The’ object of vouching is to examine the totals. The auditor can calculate all the totals by himself.
11.REPORTING
The object of vouching is also to form an opinion for the purpose of reporting. If the accounts have beer prepared truly, the report presented by auditor is also good, otherwise bad.
12.CASH AT BANK
The object of vouching is to determine the true cash at bank He can vouch all receipts and payments. So in this way he can see whether the cash book is correct or not.
Conclusion
Vouching in auditing is a critical process that serves multiple objectives. By ensuring accuracy, detecting misstatements and frauds, assessing compliance, evaluating internal controls, establishing an audit trail, and providing assurance to stakeholder
