Definition of Voucher Check
A voucher check is a financial instrument that combines a check with remittance advice, containing vital information about the parties to a transaction. This ensures an auditable paper trail for the payment details, making it a systematic choice for organizations’ financial management.
Comparison of Terms
| Voucher Check | Regular Check |
|---|---|
| Includes remittance advice | Typically does not include remittance advice |
| Creates an auditable paper trail | May not provide detailed payment context |
| Made up of three parts: check, payee voucher, and issuer voucher | Consists of a single check |
| Often used in payroll | Widely used for various types of payments |
Examples and Related Terms
- Example: A company pays its employee with a voucher check that includes the check amount, payee’s information, and a record of payment details.
- Payroll Check: A check specifically designed to pay employees, often issued in conjunction with a voucher check.
- Remittance Advice: Detailed payment information that accompanies an invoice or payment, explaining the purpose of the transaction.
Diagram: Structure of a Voucher Check
graph TD;
A[Voucher Check] --> B[Check];
A --> C[Payee Voucher];
A --> D[Issuer Voucher];
Humorous and Fun Insights
Did you know? The original “voucher check” concept came from the ancient financial system of bartering, where making things official meant carving your transaction into a rock—it was peddled as the original “checkbook”!
“In finance, every time you add a check, you also add a chance for a bouncing experience!” 🤹♂️
Frequently Asked Questions
-
What is the purpose of a voucher check?
- A voucher check serves to provide an auditable record of a financial transaction, ensuring clarity and accuracy in payments made.
-
Who typically uses voucher checks?
- Voucher checks are commonly utilized by payroll departments to keep a precise record of employee payments.
-
Can voucher checks be used for transactions outside of payroll?
- Yes, while commonly used for payroll, voucher checks can also be used for any financial transaction requiring a detailed audit trail.
-
What was the historical use of checks?
- The use of checks dates back to the 17th century in England, where merchants issued them to reduce the need for cash transactions.
Further Resources
-
Books:
- “Accounting Made Simple: Accounting Explained in 100 Pages or Less” by Mike Piper
- “The Essentials of Finance and Accounting for Nonfinancial Managers” by Edward M. Graham
-
Online Resources:
Test Your Knowledge: Voucher Check Quiz
## What are the three parts of a voucher check?
- [x] Check, payee voucher, issuer voucher
- [ ] Check, remittance advice, bank statement
- [ ] Check, invoice, payroll record
- [ ] Check, ledger, expense report
> **Explanation:** A voucher check consists of a check, a voucher for the payee, and a voucher for the issuer.
## Which statement best describes the primary purpose of a voucher check?
- [x] It creates an audit trail for payments made.
- [ ] It guarantees a bonus for employees.
- [ ] It allows for cash payments only.
- [ ] It is only used for large transactions.
> **Explanation:** The primary purpose of a voucher check is to create an audit trail that documents payment details for better financial oversight.
## Are voucher checks commonly used for payroll?
- [x] Yes
- [ ] No
- [ ] Only for contractors
- [ ] Only for bonuses
> **Explanation:** Voucher checks are often used in payroll to ensure accurate record-keeping of payments made to employees.
## What does the remittance advice part of the voucher check include?
- [ ] Bank information for the payee
- [ ] Details about the transaction or payment purpose
- [ ] Employee Social Security number
- [x] Details about the payment and related documentation
> **Explanation:** The remittance advice provides important details about the payment, including the reason for the transaction.
## In the days before computerized payroll, how were voucher checks typically issued?
- [ ] Handwritten on parchment
- [x] On standardized paper sheets with perforated items
- [ ] Via telegram
- [ ] Through a carrier pigeon
> **Explanation:** Before computerized payroll, businesses issued voucher checks on standardized sheets with perforated sections for record-keeping.
## What is another name for a voucher check?
- [x] Remittance advice check
- [ ] Cash check
- [ ] Transfer check
- [ ] Bank check
> **Explanation:** A voucher check is also referred to as a remittance advice due to its inclusion of detailed payment information.
## Can voucher checks be used for reasons other than payroll?
- [ ] No, they are strictly for payroll.
- [x] Yes, for any payment requiring detailed auditing.
- [ ] Only for vendor payments.
- [ ] Only for refunds.
> **Explanation:** While commonly used for payroll, voucher checks can be employed for any transaction that requires thorough auditing.
## Are voucher checks typically treated like regular checks by banks?
- [ ] Yes, with no additional steps.
- [ ] Only if they are signed in blue ink.
- [x] Yes, but may take longer to process due to documentation.
- [ ] No, they bypass the bank.
> **Explanation:** Voucher checks are treated like regular checks by banks; however, the accompanying documentation may affect processing times.
## What is one main feature that sets voucher checks apart from regular checks?
- [x] They come with detailed payee and transaction information.
- [ ] They are only written in amounts over $1000.
- [ ] They are always printed in bold font.
- [ ] They only require one signer.
> **Explanation:** The primary feature that distinguishes voucher checks is the detailed information provided with them, ensuring a documented trail for accounting.
## What happens if a business forgets to document their voucher checks?
- [ ] They receive a golden star reward.
- [x] They can cause complications during audits.
- [ ] They discover money printing.
- [ ] They create a mysterious unpaid account.
> **Explanation:** Forgetting to document voucher checks can lead to complications during audits, as detailed records are essential for accurate financial oversight.
Thank you for exploring the whimsical world of voucher checks! Remember, in finance, keeping track is as crucial as counting your blessings—perhaps even more so when tax season rolls around! Keep smiling and stay informed! 😊
