Question

describe  in detail Vouching – the first step towards substantial analysis with the references

Answer 1

• Vouching is nothing but examination of documentry evidence which substantiate transanctions.
• It is the first most aspect of the process of audit which gives a primary evidence of whether the transanction is not bogus.
• When an accounting transaction is vouched, it is verified for its authenticity.
• Vouchers are the underlying records for the financial transanctions, any transanctions shall generally have vouchers on which basis it shall be accounted. As vouching is the primary part of audit it shall give brief look into the organisations day to day transanctions.
• When we consider an audit procedure to audit a financial transanction, we may hit to the bottom of the transanctions which is the underlying evidence namely Vouchers.
• Through vouching the nature,timing,values are determined which is very much essential for financial reporting.
• When the authenticity of the transanctions are determined vouching is foremost essential part of perusing authenticity.
• While vouching is primary phase of analysis, it aids to decide upon the furthur procedures need to be carreied out henceforth.
• For eg: while analysing the cost of goods produced, vouching shall be the first analysis procedure carried out. Which then leads to the comaprison of industry vide data, Market movements, Volatality in supply and demand etc. But vouching shall give a base for analysis of such data. Which gives a relaible data sets of the respective organisation transanctions.