Vouching vs Tracing
Lesson:
Vouching and tracing are two techniques for examining information when auditing.
- Vouching - Going from the financial ledger and try to find the source document. This answers the question 'Is the recorded information real?'
- Tracing - Going from the source document to the financial ledger This answers the question 'Is the information we have recorded?'
An audit client has asked you to explain your activities to his employees.
You've been briefed with the following facts:
- You decided to look for the cost of goods sold expense account.
Is this an example of tracing or vouching?
Answer:
- This is an example of tracing.