What is Validate in Accounting?

In accounting, to validate is to verify that a transaction is correct. For example, an employee time card is examined and approved by a supervisor before it is loaded into the payroll system. Validation is a common control in an accounting system. Auditors will test to see if validation controls are functioning properly, as part of their examine of an organization’s system of internal controls.

What is the Goal of Validation?

The goal of validation is to ensure that an organization’s financial information is reliable and can be used for decision-making, reporting, or auditing purposes. Without validation, the level of reliance that you could place on an organization’s financial information would be much lower.