Vouching of Payment Side of Cashbook

Vouching of Payment Side of CashbookPrinciples of Vouching by Nadeem IshtiaqVouching of Payment Side of CashbookSeparately maintained journal is called Cash Payment Journal.Proper authorization of paymentPayment relates to business operationsAcknowledgement of cash receivedNecessary documentary evidenceProper accounting entriesVouching of Payment Side of CashbookCash PurchasesPayments to CreditorsWagesSalariesDirectors FeesCommission of Salesmen & AgentsTraveling AllowanceFreight & CarriageCustom DutiesInsurance PremiumAdvertising ExpenseBank Charges

Bills Payable PaidBill Receivable DishonoredInvestment PurchasedLand & Building PurchasedPlants Furniture etc. PurchasedPayments Under Hire Purchase AgreementLoans Advanced by the ClientDividends PaidPartners DrawingOther ExpensesCash PurchasesCash Memo issued by the vendorAcknowledge of cash received by the vendorDetails of goods purchasedInvoiceProper authorization of purchasesPurchase RequisitionSuppliers QuotationPurchase OrderReceiving ReportPayments to CreditorsCash MemoAcknowledge of cash receivedPayments for goods purchased on creditVouching of Purchase BookPayments to suppliers for services (e.g. repair, consultancy) / Purchase of asset on creditVouching of General JournalAll documents in the name of the businessCash Discount AvailedProper accounting entries WagesRequires careful attentionMisappropriation/MisstatementHours worked or pieces producedNames of dummy workers in wages sheetEvaluation of internal control systemTest Checking Detailed CheckingSegregation of DutiesTime spent/Pieces producedAmount PayablePayment of WagesWagesWages paid on time spent basisRecord of time spent by gate officeRecord maintained by departmental foremenWages paid on the basis of pieces producedRecord of pieces produced by foremenRecord kept by storekeeperWagesExamination of wages sheetNames of workersAcknowledgement of wage received by signature and thumb impressionsCompare total wages paid with the estimates by cost departmentComparison with previous monthsSalariesAmount paid as salaries in cashbookNet salaries payable in payroll registerIncrementsAuthenticity of increment through approvalSpecial PaymentRelevant approval letterPayroll is signed by the Manager/DirectorAcknowledge of salary received by the recipient

Directors FeesArticle of AssociationProcedure of fixation of directors feesFees Fixed by ShareholdersShareholders ResolutionFees Fixed by DirectorsMinutes of the Meeting of DirectorsCommission of Salesmen & AgentsAcknowledge of the recipient AgreementRate of commissionMethod of computation of commissionAppropriate documentary evidenceAccuracy of calculationsProper accounting entriesTraveling AllowanceNot validated by vouchers of actual expensePaid as per rules of the organizationTravel related to the business purposeProper scrutiny of allowanceSignatures of the person who scrutinized the billsAuthorization of paymentAcknowledge of cash received by recipient Freight & CarriageStatements of AccountAcknowledge of cash receivedReceipts issued by the freight and carriage authorityProper allocation of expenseCustom DutiesOfficial ReceiptAcknowledge of cash receivedCustom Duty paid through agentStatement of accountOfficial ReceiptCustom duty paid on a asset is debited to asset account.Insurance PremiumPremium paid under new insurance policyInsurance PolicyDemand NoteOfficial ReceiptAcknowledge of paymentPremium paid under old policyDemand NoteOfficial ReceiptProper year-end adjusting entries

Advertising ExpenseAdvertisement through agencyStatement of accountsDetails of newspaper, radio and TV timeAcknowledge of cash received by the AgencyAdvertisement directly through mediaStatement of accountsAcknowledge of cash received by the Media

Bank ChargesBank Charges for checkbooks, bank drafts, commission & fees etcBank StatementDebit Advice

Bills Payable PaidOriginal BOE returned by the payee after receipt of amountBOE should be duly cancelledAcknowledgement of cash received Bills Receivable DishonoredDiscounted Bill ReceivableBank StatementDebit AdviceBill Receivable not DiscountedExamination of billReceipt issued by the notary public

Investment PurchasedInvestments e.g. shares, debentures, securities etcBrokers Bought NoteInvestments are physically examined during the course of verification of assets.Land & Building PurchasedSolicitors statement of settlementContract of SaleAcknowledgement of money received by the vendorTitle DeedMinutes of Directors MeetingProper capitalization of all expensesPlant, Furniture etc. PurchasedApproval of purchaseInvoice or receipt given by the vendorDescription and price of assetProper capitalization of all expenses

Payment Under Hire Purchase AgreementHire Purchase AgreementDown PaymentRate of InterestFuture InstallmentsPrincipleInterestAcknowledgement of cash received issued by hire-vendor

Loan Advanced by the ClientAuthorization to advance loansArticles of AssociationCompanies Ordinance 1984Other relevant statuteReceipt given by the borrowerLoan AgreementPromissory Note/Bill of ExchangeStamp PaperRate of interestDates of Payment of InterestRepayment of LoanSecurity or Mortgage DeedDividend PaidDirectors ResolutionRate & Amount of dividendsAccuracy of calculationTotal amount of dividendsDividends listDeposit of Income Tax Receipted challan of government treasuryPartners DrawingPartnership DeedMaximum limit of each partnerAcknowledge of amount received issued by the partnerOther ExpensesOther expenses e.g. rent, taxes, printing, stationery, telephone etcAcknowledgement of cash receivedInvoiceWritten ContractConclusionFor each and every paymentAcknowledge of cash receivedNecessary documentary evidence