Distinguish between Vouching and Verification. How would you verify? Current Asset, Current Liabilities.
Answers
Key Differences Between Vouching and Verification
The following are the major differences between vouching and verification
1.Vouching is to check the vouchers, which are in support of the accounting entry. Verification means to validate the resemblance of facts regarding the assets and liabilities, with those appearing in the Balance Sheet.
2.Vouching is done on the basis of documentary evidence i.e. vouchers, invoices, bills or statements. On the other hand, thorough analysis and documentary evidence, are the pre-requisite of Verification.
3.In vouching, items of Income Statement are examined while verification is carried out for Balance Sheet items.
Vouching is performed throughout the year, but Verification is done only at the end of the financial year.
4.In general, Vouching is carried out by Audit Clerks or Audit Assistant whereas Verification requires deep observation and that is why auditor himself conducts it.
5.Vouching aims at testing the accuracy, completeness, and authenticity of transactions. Conversely, Verification focuses on confirming the ownership, possession, valuation and disclosure of the assets or liabilities.
6.Vouching considers incomes and expenses. As opposed to Verification, which is done for assets and liabilities.