To keep a complete record of business transactions, vouchers and invoices are maintained by the company in support of the financial statements. Voucher refers to a printed document, that is used as a witness for a transaction, like the purchase of product or asset, payment of the liability. It keeps a record of the ledger account, in which the transaction is recorded.
As against this, the invoice is a non-negotiable instrument prepared by the seller and sent to the customer, containing the details of merchandise, such as quantity, quality, date of delivery, terms of payment, price, tax etc.
These two commercial instruments are helpful in showing the correct picture of entity’s profit and position, at the end of the accounting period. Now, learn the differences between voucher and invoice, with the help of given article.
Content: Voucher Vs Invoice
|Basis for Comparison||Voucher||Invoice|
|Meaning||The voucher is termed as a written internal document used for recording a liability or debt to make payment to the supplier or seller of goods or services.||An invoice is termed as a written commercial document issued to a buyer by the seller, indicating the transaction details of the sale of goods or services.|
|Types||Receipt, Payment, Purchase, Sales, Journal, Contra etc.||Excise Invoice, Commercial Invoice, Tax Invoice, Proforma Invoice etc.|
|Description||Name, Address and other details of payee, transaction details, amount, date, etc.||Items and its quantities, prices, amount, discount details (if given), date, credit terms and payment details, etc.|
Definition of Voucher
A voucher is a written document used by the accounts payable department of any organization. It represents a liability or debt against any external party which is to be paid off by the entity itself. The voucher is generated after matching with three different documents Viz. Purchase order, invoice and receiving report.
After matching with the above three documents the voucher is attached to them. The voucher must be signed by the company so that the further proceedings can be done. These vouchers are very beneficial for auditing purposes, as the company keeps proper records of all the transactions.
Definition of Invoice
An invoice is a commercial document which is further not negotiable to any other person. It is provided by the seller to the buyer of goods or services, indicating the quantities of items purchased, agreed prices, discount, terms of credit and payment details. It is a sales invoice for the vendor while a purchase invoice for the buyer.
When the sale of goods or services is made in credit, the invoice becomes a trade receivable for the seller, while a trade payable to the buyer.
Key Differences Between Voucher and Invoice
- The voucher is a document for recording liability while Invoice is a list of goods sold or services rendered, issued by the supplier to the customer when sales are made.
- There are six types of vouchers whereas there are four types of invoices.
- Vouchers contain details of the total quantities, the total amount of the goods purchased and ledger to which it has been recorded. On the contrary, an invoice includes details of the goods purchased from a particular company.
- Written Document.
- Retained by the company for future references.
- Details of the transaction.
- Acts as an evidence at the time of auditing.
Nowadays, due to the emergence of an electronic system, these documents are also available in either electronic or paper form or both, depending upon the policies of the organization. The voucher is dependent on the invoice because it can be made only when it is matched with the three documents discussed above and invoice is one of them. Hence, they are not contradictory in nature, but completes each other. With the help of these two documents, a firm can track all the transactions done so far, which acts as a proof at the time of auditing. Apart from that, both the voucher and invoice are a written as well as authorized document, which works as evidence at the time of auditing.