What Is a Voucher Check?
A voucher check is a combination of a check and a voucher, also known as "remittance advice," which includes pertinent information about the parties to the transaction and thus creates an auditable paper trail about that check's payment.
Key Takeaways
- A voucher check is a form of official payment that creates an audit trail about that check's payment details.
- Voucher checks have three parts: the check, a voucher for the payee, and a voucher for the issuer. Before computerized payroll, these would come in the form of three perforated items from a standardized paper sheet.
- Voucher checks are commonly used by a company's payroll department and may be referred to as payroll checks in that context.
Understanding Voucher Checks
The voucher check creates a paper trail for the payment by the issuer of the check. The recipient of the voucher check detaches one voucher part and retains it for record-keeping before cashing the check. The issuer retains the other voucher portion.
Voucher checks that are used in computerized accounting systems have three parts that together fit on standard-sized sheets of paper for ease of use in printers. The checks are usually business sized—longer than a standard check but with the same width. One part is the check and the other two parts are the vouchers for the payee and issuer for their respective records. Perforations make the different sections easy to separate.
A voucher is a document used by a company’saccounts payabledepartment to gather and file all of the supporting documents needed to approve and track the payment of aliability. A voucher is essentially the backup documents for accounts payable, invoicing, or payroll. (Accounts payable are the short-term bills owed by companies to vendors and suppliers.) The voucher is important because it is an internalaccounting controlmechanism that ensures that every payment is properly authorized and that the goods or services purchased are actually received.
Who Uses Voucher Checks?
Voucher checks are commonly used by a company's payroll department and are referred to as payroll checks. The voucher will contain a voucher number, name of the payee, date, amount (gross and net if any deductions), signatures, and any memo notes that need to be recorded. For payroll, even though direct deposit is increasingly becoming the norm for paying employees, having a paper trail back-up is a common practice.
Vendors also use voucher checks. In this instance, a voucher check is issued when an invoice is matched with a purchase order and documentation that the order was filled. In addition, for the accounts payable department, having a file of voucher records of payments to vendors is helpful in resolving payment disputes and in preparing books for internal month-end closings.
FAQs
A voucher check is a check type that has vouchers attached to it that contain details of the transaction and is used for better recordkeeping. Voucher checks are commonly used for payroll processing, as a lot of details can be explained through the voucher system.
What are the benefits of vouchers? ›
Benefits of Voucher
- To maintain control over the payment process.
- High accuracy of business transactions.
- Makes it easy to identify the transaction source.
- Many invoices can be paid at once (reducing the number of cheque).
- Invoice approval is separated from invoice payment, makes it easier to schedule.
A voucher check is a form of official payment that creates an audit trail about that check's payment details. Voucher checks have three parts: the check, a voucher for the payee, and a voucher for the issuer.
What are voucher checks commonly used for? ›
Who Uses Voucher Checks? As we mentioned above, voucher checks are commonly used by businesses to pay their staff or vendors. Even if a company directly deposits pay into employee bank accounts, they may choose to keep a paper trail via a voucher check.
What is an example of a voucher payment? ›
Example payment voucher process
Essentially, a company orders inventory from a vendor and the company manager fills out a purchase order. The owner initials the PO to approve the shipment. When the shipment is received, the contents of the shipped order is compared to the purchase order to ensure it matches.
What is the main purpose of voucher? ›
Vouchers document that the goods purchased were actually received, which supports the auditor's assertion that the goods and services posted to the financial statements truly exist. Vouchers also justify the firm's cash payments to vendors and document the general ledger accounts used to post the transaction.
What is the purpose of pay voucher? ›
Payment Vouchers are used to record payments owed to Vendors and to maintain payment history. Once posted, they can be added to Checks or Quick Checks for processing and printing checks.
How does a voucher work? ›
In other words, a voucher is a supporting document for an invoice received by the company. Once the voucher is issued, it means that the invoice's been checked, and it's been confirmed that it needs to be paid. The voucher authorizes the payment of the invoice in one lump-sum that will be written on the balance sheet.
What is the purpose of a cash voucher? ›
A cash voucher is a document that serves as proof of a cash transaction. It is typically used in accounting and bookkeeping to record and validate cash payments made for various expenses, such as office supplies, utility bills, or other miscellaneous expenses.
What is a deposit voucher? ›
A form that is completed by a depositor in order for them to make a cash or check deposit into a bank account.
A cash voucher is a standard form used to document a petty cash payment. When someone wants to withdraw cash from the petty cash fund, that person fills out the cash voucher to indicate the reason for the withdrawal, and receives cash from the petty cash custodian in exchange.
What does direct deposit voucher mean? ›
Direct Deposit Vouchers show the dollar amount of funds transferred into each prenoted employee account.
What is a bank voucher? ›
Answer and Explanation: A bank voucher represents documentation entailing the money transactions with the specific amount in a bank due to withdrawals and deposits done. Therefore, the transactions are centered around the bank's operations and the timeline under which it's designated to operate under.
What is a voucher check? ›
A voucher check is a check type that has vouchers attached to it that contain details of the transaction and is used for better recordkeeping. Voucher checks are commonly used for payroll processing, as a lot of details can be explained through the voucher system.
What does a payment voucher do? ›
Form 1040-V: Payment Voucher is a statement that taxpayers send to the Internal Revenue Service (IRS) along with their tax return if they pay with a check or money order to their IRS filing center defined by their location. Filers who send their payments electronically do not need to file Form 1040-V.
Is a payment voucher necessary? ›
Payment vouchers act as vital records for companies that help them maintain a systematic record of all their financial transactions. However, this organized documentation is essential for auditing and financial analysis.
What are vouchers used for? ›
A voucher is a document used to process payments in a company. A payment voucher is a record of payments made by a business to suppliers for various purchase orders.
What are the disadvantages of vouchers? ›
The main disadvantages to the system are the lack of consumer familiarity with paper vouchers, concerns around security that are largely unfounded, and their general unpopularity preventing widespread use.
Why do people give vouchers? ›
Increasing Sales – Vouchers can boost sales, especially during slower periods. They encourage people to complete purchases they may have postponed or to spend more than they initially intended.
Why are vouchers effective? ›
Vouchers reduce poverty, homelessness, and housing instability. They can also help low-income families — particularly African American and Hispanic families — raise their children in safer, lower-poverty communities and avoid neighborhoods of concentrated poverty.
