Journal numbers on expense bills

A/c entries 505 views 2 replies

Chirag Patel

Proprietor

24 Points Joined October 2011

Dear CAclub Members,

I have a small firm and track all expenses meticulously. Even the smallest Expense bills (e.g., bus tickets) are carefully filed Date-wise. The bills are then entered in my accounting software.

During auditing the CA asked me to write the Journal Numbers generated by the Accounting software for the Expense Entries on each Bill! This activity will be very very time consuming and not sustainable in the long term. I have requested the Auditor to query me for any Expense Journal Entry and I can present the corresponding Bill out from the File, if he cannot find it by himself (i assume this could be the only reason why he wants this whole exercise to be undertaken).

But he says this is an Accounting Norm and is mandatory. Could any of you please shed light on this. Should Journal Entries genreated by the Accounting Software be written on the Expense Bill? Is there an Accounting Standard that mandates this?

Thank You in advance.

Chirag.

Replies (2)

Phalgun

Audit Manager

327 Points Joined July 2009

Dear Chirag

The CA says its a norm and mandatory .By reading your query no were CA says its a Standard. It is because in accounts we highlight on disclosure policy. If bill numbers are disclosed while passing entries either in narration or bill number. It will be easier to track the same. Writing bill number is just like giving name to a child for easy identification. Certain bills need not require this process if well distinguished & filed like light & telephone bills. Moreover accounts is an art & discipline in itself

Mihir

Wealth Manager

5293 Points Joined December 2008

It is always better to number each and every accountring entries / vouchers. To avoid any mistakes or error, willfully or otherwise; to avoid double data-entry of the same voucher. And once the voucher numbering is properly placed, then you can spend more time in developing business rather checking each and every voucher so meticulously.

My personal exp; I once worked in a company where no voucher numbering was followed. After audting it thoroughly, it was found that many vouchers were not even entered and some were entered twice in the accounting software. So I installed voucher numbering manually to create discipline in the accounting staff, and now its not only easy to follow but the errors are negligible.