Wocop

A voucher is a redeemable form of transaction bond that is worth a particular monetary value and can only be used on specific grounds or specific goods. 1. Made in the Name of the Employer : The auditor should see whether the voucher is made in the name of the employer of the concern. 2. Printed Form : He should see whether the voucher is on a printed form. 3. Serial Number : He should see whether all vouchers are consecutively numbered and filed in order of the entries in the various books. 4. Date, Name, Amount, etc .: The auditor should check the date, name of the party to whom the voucher is issued, the name of the party issuing the voucher, and the amounts, etc. 5. Cancelled by Stamp : The vouchers, which are inspected by the auditor, should be cancelled by a stamp so that it cannot be produced again. 6. Related to the Firm : The auditor should also see that all the vouchers are related to the business or not and see whether the payments made by the concern relate to the business...

  Fixed Asset: Verification & Valuation  I. Tangible Asset 1. Freehold land and building: Verification: The auditor should examine the title deeds to ensure that they are in the name of the client. Any addition or sale during the year should be carefully examined. Valuation: Freehold land being a no depreciable asset is generally shown at cost which includes the purchase price, broker’s commission, registration fees, legal charges etc. Any payments made to Municipality Corporation or improvement trust as developmental charges should be included in the cost. If market realizable value is taken as basis for valuation of freehold land the same should be disclosed clearly in the balance sheet Valuation of buildings: Buildings should always be valued at cost less depreciation at a reasonable rate. Actually, the market or realized value of the buildings keeps on fluctuating. Therefore, it should be taken into account while valuing the buildings. 2. Leasehold property: Verificat...

Verification Meaning and Definition Verification means the procedures normally carried out at the year end, to confirm the ownership, valuation and existence of items at the balance sheet date. In simple words verification means, ‘proving the truth or conformation.’ “The verification of assets implies an enquiry into the value, ownership and title, existence and possession, and the presence of any charge on the assets.” - Spicer and Pegler Valuation Meaning and Definition Valuation means to set the exact value of an asset on the basis of its utility. Valuation forms an important part of the everyday audit. It is because the accuracy of the balance sheet depends much upon how correctly the estimation of the value of various assets and liabilities has been made. Both overvaluation and under- valuation of assets and liabilities would exhibit the wrong picture of the financial affairs of a concern. The auditor has to see that the assets and liabilities appearing in the balance sheet have b...

1. Vouching Is The Backbone Of Auditing   The main aim of auditing is to detect errors and frauds for proving the truth and fairness of results presented by income statement and balance sheet. Vouching is only the way of detecting all sorts of errors and planned frauds. So, it is the backbone of auditing.   2. Vouching Is The Essence Of Auditing   Auditing not only checks the accuracy of books of accounts but also checks whether the transactions are related to business or not. All the transactions are performed after the prior approval of the concerned authority or not, transactions are real or not because an accountant may include fictitious transactions to commit frauds. All these facts can be found with the help of vouching. So, vouching is essential for auditing.   3. Vouching Is Important To See Whether Evidence Are Correct Or Not   An auditor checks the books of accounts to detect errors and frauds. Frauds may be committed to presenting duplicate vouchers....

Vouching of Purchase Book The main aim of vouching of purchases book is to see that all purchase invoices are entered in purchases book and the goods entered in the purchases book are entered are actually received by the business. While vouching for credit purchases the auditor should examine and see the following points. There should be a proper record for all purchase orders. A duplicate copy of the order is kept in the office for record. A copy of the purchase order shall be sent to the Accounts Department. All goods received should be recorded on the goods received note; a copy of it should be sent to the Accounts Department. The auditor should see that only credit purchases of the goods are recorded in the purchase book. The purchases book can be verified from purchase invoices, copies of orders placed, goods received a note, goods inward book, copies of challans from suppliers. The quantity mentioned in the invoice must be the same as is shown in the purchase order. The price cha...

How to vouch for various cash receipts  Receipt side 1. Cash sales : In vouching for cash sales, the cash register should be fully checked with carbon copies of cash memos. Then, the auditor should verify the daily deposits of cash received in the bank dates of the cash and the date on which the receipts are recorded in the cash book must be the same. Where the cash memos are cancelled, all copies including the original copy duly cancelled should be kept in the book. Where a company has a discount policy, if more discount is allowed in a transaction it must be approved by a responsible officer. 2. Cash received from the debtors: The auditor should verify the amount received from debtors from the counterfoils or carbon copies of the receipt issued to the customers. All these receipts should be serially numbered. The amount should be entered in the cash book on the day when received. Discount allowed to customers should be authorized by a responsible officer. Sometimes correspondence...