The examination of documentary evidence in support of transactions contained in the books of account is referred to as vouching. It is the technique followed in an audit for establishing authenticity of the transactions recorded in the primary books of accounts. it essentially consists of verifying the records of transactions contained in the books of accounts with the relevant documentary evidence and the authority on the basis of which entries were made, also examining in the process whether the amount mentioned in the voucher has been posted to an appropriate account, which would disclose the nature of the transaction on its inclusion in the final statements of accounts. On these considerations, the essential points to be borne in mind while examining the voucher are:
That the date of the voucher falls within the accounting period.
That the voucher is made out in the client‟s name;
That the voucher is duly authorized;
That the voucher comprises all the relevant documents, which would be expected to have been received or brought into existence on the transactions having been entered into i.e. the voucher is complete in all respects and
That the account in which the amount of the voucher is adjusted is the one that would clearly disclose the character of the receipt or payment posted thereto on its inclusion in the final accounts.
On the other hand, the term verification usually applies to the process of auditing that examines, appropriate manner whether assets and liabilities are properly stated in the balance sheet. The term verification may also apply to items of profit and loss account for checking of account balance and their presentation.
Verification in the context of balance sheet items involves an inquiry into ownership, valuation, existence and presentation of assets and liabilities. Regarding assets the auditor while verifying whether assets are owned the client also looks into whether any charge has been created on them and whether the same has been appropriately disclose, in case of liabilities, the auditor would like to see that these are owned the organization. thus, it is clear from the above that vouching deals with the examination of transactions at their points of origin while verification usually deals with the balances contained in the Balance Sheet and Profit and Loss Account.