What do you mean by vouching? Differentiate between vouching and routine checking.

  Definition of Vouching: Vouching consists of checking the entries in financial books with the help of available documentary evidences e.g. Vouchers, receipts, invoices, minutes, contracts, statements, correspondence etc. For each entry it is to be ascertained that it is properly authorized and no transaction has been omitted from recording in the books of accounts.

According to B.B. Bose, "By vouching is meant the verification of authority and authenticity of transaction as recorded in the books of accounts."

According to De Paula, "Vouching does not mean the inspection of receipts with cash book but includes the examination of receipts with transaction of business, together with documentary and other evidence of sufficient validity to satisfy an auditor that such transactions are in order, have been properly authorised and are correctly recorded in the books."

According to Arthur. W. Holmes, "Vouching is the examination of the underlying evidence which is in support of the accuracy of the transaction. The process of vouching is intended to substantiate an entry by providing authority, ownership, existence and accuracy."

Objectives of Vouching 

• All transactions connected with the business have been properly recorded in the books of accounts. 
• The entries in the books of accounts pertain to transactions connected with the business. 
• The vouchers in support of the entries are legally valid, i.e. they are authentic, properly dated, properly authorised and are not fraudulent in any respect. 
• The vouchers have been carefully processed through each stage of an effective system of internal check.

Importance of Vouching

1. Vouching is the primary work of auditing: The work of audit is performed with the support of vouchers. In the absence of vouchers and vouching, audit work cannot be imagined.

2. Vouching is the essence of Auditing: According to B.B.Bose, with the help of vouching an auditor can make complete verification of the books of accounts and on the basis of which he can make audit work more reliable.

3. Vouching is the fundamental work of auditing: Vouching is the foundation of auditing. If the work of vouching is properly done then the work of audit will be perfect and the chances of errors and frauds in the books will be minimised.

4. Vouching is the soul of auditing: Vouching is the soul of auditing because it is vouching on the basis of which the work of audit proceeds.

Thus, vouching is a must for an efficient audit. It is the backbone or the essence of auditing.

Routine Checking is the elementary part of auditing. It is checking of arithmetical accuracy of books of account, accounting statements and other related accounts. These books of accounts are Journal, Ledger books, Cash book, Trial Balance and other subsidiary books. Checking of these books by an auditor or his staff is called Routine Checking. Routine Checking is useful to apply in the following cases:

1. To detect errors and frauds of simple nature.

2. To ensure the arithmetical accuracy of the books of original entry.

3. To ensure the correctness of posting to ledger accounts.

4. To ensure the accuracy of casting and balancing in ledger.

5. To ensure the correct transfer of balances to the trial balance and the correctness of the trial balance.

6. Prevention and alteration of figures after the records have been checked. 

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