Voucher System of Control A voucher system is a set of procedures and approvals designed to control cash payments and the acceptance of liabilities that consist of \u2022 Verifying, approving, and recording liabilities for cash payment. \u2022 Issuing checks for payment of verified, approved, and recorded liabilities. A voucher system’s control over cash payments begins when a company incurs a liability that will result in cash payment. The system only allows authorized departments and individuals to incur liabilities and limits the type of liabilities. In a large retail store, for example, only a purchasing department is authorized to incur liabilities for inventory. Purchasing, receiving, and paying for merchandise are divided among several departments (or individuals). These departments include the one requesting the purchase, the purchasing department, the receiving department, and the accounting department. To coordinate and control responsibilities of these departments, a company uses several different business documents. Exhibit 6.1 shows how documents are accumulated in a voucher, which is an internal document (or file) used to collect information to control cash payments and to ensure that a transaction is properly recorded. This specific example begins with a purchase requisition and ends with issuing a check.<\/p>\n\n\n\n
The Correct Answer and Explanation is :<\/strong><\/mark><\/p>\n\n\n\n A voucher system of control<\/strong> is a method used by companies to manage and regulate cash payments and the acceptance of liabilities. It ensures that only verified, approved, and recorded liabilities are paid, maintaining a structured approach to financial transactions.<\/p>\n\n\n\n A voucher system of control<\/strong> is a key internal control mechanism used by businesses to safeguard cash payments and manage liabilities efficiently. The system is designed to prevent unauthorized transactions and errors by ensuring that payments are only made for properly verified expenses.<\/p>\n\n\n\n The system operates by first verifying, approving, and recording liabilities before cash payments are made. This ensures that every expenditure is legitimate, authorized, and accounted for properly. When a company incurs a liability that will lead to a cash payment, the process starts with an approved purchase requisition, typically initiated by a department in need of goods or services.<\/p>\n\n\n\n In large organizations, responsibilities related to purchasing, receiving, and paying for goods are divided among different departments. The purchasing department<\/strong> is responsible for placing orders, while the receiving department<\/strong> ensures that the goods delivered match the order. The accounting department<\/strong> then verifies and records the transaction before any payment is issued.<\/p>\n\n\n\n A key component of the voucher system is the voucher document<\/strong>, which acts as an internal control record. This document accumulates all necessary supporting documents, including the purchase order, receiving report, and invoice, to confirm the legitimacy of the transaction. Once all necessary approvals are obtained, the accounts payable department prepares a check for payment.<\/p>\n\n\n\n By using a voucher system, businesses prevent unauthorized expenditures, improve financial accuracy, and maintain accountability in their cash payment processes. This system is particularly beneficial for large organizations where multiple departments handle purchases, ensuring proper checks and balances at every step of the payment process.<\/p>\n","protected":false},"excerpt":{"rendered":" Voucher System of Control A voucher system is a set of procedures and approvals designed to control cash payments and the acceptance of liabilities that consist of \u2022 Verifying, approving, and recording liabilities for cash payment. \u2022 Issuing checks for payment of verified, approved, and recorded liabilities. A voucher system’s control over cash payments begins […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"site-sidebar-layout":"default","site-content-layout":"","ast-site-content-layout":"default","site-content-style":"default","site-sidebar-style":"default","ast-global-header-display":"","ast-banner-title-visibility":"","ast-main-header-display":"","ast-hfb-above-header-display":"","ast-hfb-below-header-display":"","ast-hfb-mobile-header-display":"","site-post-title":"","ast-breadcrumbs-content":"","ast-featured-img":"","footer-sml-layout":"","ast-disable-related-posts":"","theme-transparent-header-meta":"","adv-header-id-meta":"","stick-header-meta":"","header-above-stick-meta":"","header-main-stick-meta":"","header-below-stick-meta":"","astra-migrate-meta-layouts":"default","ast-page-background-enabled":"default","ast-page-background-meta":{"desktop":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"tablet":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"mobile":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""}},"ast-content-background-meta":{"desktop":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"tablet":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"mobile":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""}},"footnotes":""},"categories":[25],"tags":[],"class_list":["post-187779","post","type-post","status-publish","format-standard","hentry","category-exams-certification"],"_links":{"self":[{"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/posts\/187779","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/comments?post=187779"}],"version-history":[{"count":0,"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/posts\/187779\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/media?parent=187779"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/categories?post=187779"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/tags?post=187779"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}Correct Answer:<\/h3>\n\n\n\n
Explanation (300 Words):<\/h3>\n\n\n\n