One widely used system of establishing internal control over cash disbursements
Is a voucher system. In a typical voucher system, the accounting department is responsible for approving cash payments and for recording the transactions. In approving an expenditure , the accounting department will examine such supporting documents as the supplier's invoice , the purchase order, and the receiving report.
Once payment has been approved, the accounting department signs a voucher authorizing payment and records the transaction in accounting records.( Other names of the voucher include invoice approval form and check authorization.The voucher and supporting documents then are sent to the treasurer or other official in the finance department. This official reviews the voucher and supporting documents before issuing the check.
When the check is signed , the voucher and supporting documents are perforated or stamped "PAID" to eliminate any possibility of their being presented later in support of another check. Notice that neither the personnel in the accounting department nor the personnel in the finance department are in a position to make unapproved cash disbursements. Accounting personnel ,who approve and record disbursements , are not authorized to sign checks. Finance department personnel , who issue and sign checks , are not authorized to issue a check unless they have first received an authorization voucher from the accounting department.
Is a voucher system. In a typical voucher system, the accounting department is responsible for approving cash payments and for recording the transactions. In approving an expenditure , the accounting department will examine such supporting documents as the supplier's invoice , the purchase order, and the receiving report.
Once payment has been approved, the accounting department signs a voucher authorizing payment and records the transaction in accounting records.( Other names of the voucher include invoice approval form and check authorization.The voucher and supporting documents then are sent to the treasurer or other official in the finance department. This official reviews the voucher and supporting documents before issuing the check.
When the check is signed , the voucher and supporting documents are perforated or stamped "PAID" to eliminate any possibility of their being presented later in support of another check. Notice that neither the personnel in the accounting department nor the personnel in the finance department are in a position to make unapproved cash disbursements. Accounting personnel ,who approve and record disbursements , are not authorized to sign checks. Finance department personnel , who issue and sign checks , are not authorized to issue a check unless they have first received an authorization voucher from the accounting department.
