Vouching of payment of wages is an important duty
of an auditor as there are many chances of misappropriation of cash. The
following are some of the duties of an auditor in vouching wage payments.
The auditor should verify the effectiveness of the
system of Internal check in operation with regard to the preparation of wage
sheet, maintenance of records and payment of wages.
He should verify the arithmetical accuracy in
calculation of wages.
He should verify the attendance register of the
employees and vouch it with the wage sheet to ensure that the wages has been
correctly calculated only for the days worked by the employee.
should carefully scrutinize the wage sheet to identify that no dummy workers or
ex-employees are included in the wage sheet.
Auditor should vouch the entries in the cash book
with the wage sheet. He should also vouch the entries in the cash book with the
bank statement to ensure that correct amount is withdrawn for payment of wages.
auditor should compare the signature or thumb impression of the workers with
previous months to check the genuineness of the person receiving the payment.
7. He should
ensure that unclaimed or unpaid wages has been deposited in the bank. He should
vouch the unpaid amount in the wage sheet with the entry in the bank statement.
Payment for unpaid wages should be made only against authorization signed by a
should verify that there is a proper system of wage payment to casual
Documents to be Vouched: Attendance register, Time or piece records, Leave
register, Overtime register, Wage sheet, Bank statement, Register of casual
On 5/7/2016, Paid wages by cash for Rs. 8,000.
Auditor should vouch the transaction
in the following manner:
1. Verify entry in Cash Book with
respect to wages paid amount and date of payment.
2. Verify entry in Wages Account with
regard to date and amount of payment.
3. Verify entries in Wage Sheet.
4. Verify entries in Pay Roll