Internal Voucher

A voucher can refer to a document which can be redeemed for a good or service, like a coupon or ticket. The hospitality business is a good example of this. Airlines, hotels, and restaurants, for example, may offer certificates that can be redeemed for rooms, flights, or rates.

Voucher

A voucher is a document which is used by the accounts payable department of a firm to compile and file all supporting documentation required to approve the payment of a liability. Governments may also provide vouchers that can be redeemed for a variety of programmes, such as school choice, housing, or social welfare. A voucher is a backup record for accounts payable, that are bills owed to vendors and suppliers by businesses. The invoice from the supplier, the amount owed, the due date, shipping receipts and general ledger accounts are all examples of documents that might be included in a voucher. On the balance sheet, the total amount of outstanding vouchers owed is summed, and the result is reported as accounts payable.

Voucher in Accounting

A voucher is an accounting document that represents an internal purpose to pay an external party, like a vendor or service provider, for a specific amount. A voucher is often created after receiving a vendor invoice and successfully matching it to a purchase order. The voucher is significant because it serves as an internal accounting control tool which ensures that all payments are correctly authorised and the goods or services purchased are received.

Advantages of Voucher in Accounting

• Vouchers might assist you in keeping a good control on your payables process.
• A large number of bills can be paid at once, reducing the number of cheques needed.
• Vouchers can be pre-numbered, making the payables audit trail more manageable.
• Invoice approval and payment are segregated to improve the efficiency and make planning easier.
• The cashier is in charge of invoice collection and reporting to treasurer.

Supporting Voucher

The source or supporting vouchers are created at the moment of the transaction. These vouchers are written documentary proof of business transaction in support of transaction which has occurred, and source vouchers are used to make entries in the books of account.

Types of Supporting Voucher

There are two types of supporting voucher which are given as:

1. Internal voucher
2. External voucher

Internal Voucher

When voucher is formed by the firm itself, but the validation of the voucher is performed by a third party such as counterfoils of pay-in-slips, on which stamp is affixed by the bank and it bears the signature of bank officer and counterfoils of challan for advance payment of tax.

Internal Voucher Examples

The internal voucher examples include vouchers which are created for expenses for which there is no invoice or receipt.

Example of Vouchers

Every few days, a little minimarket orders fresh food from their source. The manager of the fresh food department places an order for 60 pounds of meat and fish, and owner approves the delivery by initiating the order. When the minimarket receives the order, it compares the contents of delivery to the order to ensure that everything was received correctly. A voucher is supplied at this stage. The purchase order, the shipment receipt, and the invoice are all included. The outstanding balance is also included, and it will be recorded in accounts payable until it is paid.

The voucher will be given to the owner, who will examine everything to ensure that all of the information is correct before approving the payment. The transaction is then completed, and the voucher is recorded in the balance sheet as a paid voucher.

Voucher Payment Process

When the voucher is due for payment, it is withdrawn from the unpaid folder and delivered to a relevant official, along with the accompanying documentation, for final payment approval. When the voucher is approved, the payment is made in the form of a check or an alternative means of payment, and the check number and date are recorded in the voucher register. At this point, the voucher is marked as paid and filed in the voucher paid folder alongside the supporting paperwork. It should be remembered that the amount of the unpaid vouchers represents the outstanding liability to suppliers, who must agree to the balance on accounts payable account.

Conclusion

A voucher is a document which is used by the accounts payable department of a firm to compile and file all supporting documentation required to approve the payment of a liability. A voucher is often created after receiving a vendor invoice and successfully matching it to a purchase order. A large number of bills can be paid at once, reducing the number of cheques needed. Vouchers can be pre-numbered, making the payables audit trail more manageable. There are two types of supporting voucher which are given as Internal voucher and External voucher. Therefore, we can finally conclude that Internal Voucher are the vouchers that are used for internal purposes within an organisation, such as the transfer of commodities from one branch to another. These also include vouchers that are prepared for expenses for which there is no invoice or receipt. It contains certificates for auto, cab, and hawker purchases, among other things.