Vouching comes under the Auditing Paper of the CA IPCC Group-2 Examinations.
On an average, it will be asked for around 6-8 marks in the auditing exam.
Below, We are providing a trick to answer a Vouching question. We recommend students to follow this trick only when you have less time to allot to Auditing Syllabus.
Irrespective of the question given in the exam, you just need to write the following answer. All you needed to do is replace the ‘______’ with the question given.
Vouching Shortcut Answer:
The process of examining the vouchers is called Vouching. The basic objective of vouching is to authenticate the transactions recorded in the books of accounts.
Few steps during this process shall include:
1. Authority: The Auditor shall ensure that all expenditures relating to ___________ has been approved by proper authority.
2. Appropriate account: Auditor shall verify that all transactions and entries of _________ has been posted to proper accounts.
3. External Confirmations: With the advent of latest scams, it is utmost important to not just rely on the management representations. Auditor has to obtain external confirmations to verify the balances of ________, as shown in books of account
4. Tax Compliance: Confirm whether the payments for _________ were made only after deducting the TDS at applicable rates.
5. Accounting Standard: Ensure that all the postings and adjustments were made as per AS ___
6. Cross Verification: All the vouchers relating to _________ shall be cross verified with the respective ledger accounts.
What is the Purpose of Vouching?
Vouching is a part of Audit to authenticate the validity of the transactions of a business entered in the books of account. It also verified whether there is proper authority for sanctioning the vouching expenditure.
Functions of Vouching:
- Check whether the vouching date falls within the accounting period.
- Verify whether the voucher is duly authorised by the competent authority.