Journal Voucher

A Journal Voucher, better abbreviated to JV, is a document that is used in accounting to register financial transactions that can't go through standard accounting entries. Journal vouchers act as a manual way of recording and documenting accounting entries of such nature as corrections, accruals, reclassifications and internal transfers. Unlike the accounting entries that are automatically generated by accounting software systems, journal vouchers are manually prepared by accountants or financial professionals and must be approved and verified for accuracy before they can be posted to the general ledger. Journal vouchers track the chain of financial transactions and the implementation of the rules of accounting principles and regulatory compliance.

Example of Journal Voucher

Assume that XYZ Corporation, a firm, finds an error in its financial data where an invoice for sale was registered under the wrong revenue account. The accounting department rectifies the mistake by issuing a journal voucher which transfers the transaction to the correct revenue account. The journal voucher consists of following details: the transaction date, the original incorrect account affected, the correct account to credit, a description of the error and the reason for the correction. The finance manager reviews and approves the journal voucher, which is then posted to the general ledger. This ensures that the financial statement of XYZ Corporation reflects the correct position. Coming to the journal vouchers, these are also used extensively to record non-routine transactions like asset impairment, foreign currency adjustment, and accrual for expenses not yet paid.