When auditors use documentation to support recorded transactions and amounts, the process is usually called
A) tracing.
B) confirmations.
C) vouching.
D) reperformance.

Question

Quizplus · Accepted Answer

Vouching is the process of verifying transactions and amounts in the financial statements by reviewing and tracing the source documents backwards through the accounting system. This involves using documentation such as invoices, receipts, and contracts to support recorded transactions and amounts. Tracing involves verifying that original source documents have been properly recorded and accounted for, while reperformance involves redoing procedures that have already been done by the company to ensure accuracy. Confirmations, on the other hand, involve verifying information with third-party sources such as banks and customers.

When Auditors Use Documentation to Support Recorded Transactions and Amounts