Voucher definition

/

How is a Voucher Used in Accounting?

A voucher is an internal document describing and authorizing the payment of a liability to a supplier. It is most commonly used in a manual payment system, where it is part of the system of controls. A voucher is created following the receipt of an invoice from a supplier. It is stamped "paid" when a check or electronic payment is made to a supplier and is then archived, along with any supporting documents.

Voucher information may be assembled into a packet, where the basic voucher document is attached to the supplier invoice, evidence of receipt, and purchase order. This packet is useful for keeping related documents in one place, and makes it easier to both justify and audit payables transactions.

If vouchers are used for all payables, their totals can be aggregated to determine the total amount of accounts payable outstanding. This function is not needed in a computerized system, where the aged payables report is used instead. Consequently, this use of vouchers has fallen out of use.

Related AccountingTools Courses

Optimal Accounting for Payables

Payables Management

Contents of a Voucher

A voucher typically contains the following information:

  • Voucher number. This is a unique identifier to track each voucher in the accounting records.

  • Date. This is the date when the voucher was created or the date of the transaction.

  • Payee information. This is the name and address of the party to whom the payment is to be made.

  • Amount. This is the exact amount to be paid, often written in both numerical and word form to avoid misinterpretation.

  • Description. This is a brief description or explanation of what the payment is for.

  • Account details. This is the ledger account information where the transaction will be recorded. This may include account numbers and descriptions.

  • Supporting documents. This is any attachments or references to supporting documents like invoices, purchase orders, and receipts that validate the transaction.

  • Terms of payment. This is the details on payment terms, including due dates or discounts applicable for early payment, if relevant.

  • Authorization. This is any approval signatures from authorized personnel, such as department heads or financial officers, who verify and approve the payment.

  • Tax and other deductions. This is the details of any taxes or other deductions applicable to the transaction.

  • Payment method. This is information on how the payment will be made (e.g., cash, bank transfer, or check).

  • Notes. This is any additional notes related to the transaction, such as payment conditions, installment terms, or special instructions.

Each of these elements helps ensure that payments are accurate, authorized, and properly recorded in the accounting system.

When Not to Use a Voucher

A voucher is not created when a liability has only been accrued (which is done in the absence of a supplier invoice, and when the accrual basis of accounting is used). Also, vouchers are not used in the payroll process. In the payroll process, payments are made based on an approved timesheet or timecard that is submitted by a supervisor to the payroll staff.

How is a Voucher Used for Redemptions?

A voucher can refer to an official document that can be redeemed for a product or service. For example, an airline may give a bumped passenger a voucher for a free meal or hotel room, while a hotel may offer a voucher to a guest for a free night at the hotel.