An original record of any transaction made is known as a source document. It is also known as the business paper. It is an evidence of the detailed list of transaction made. It is given in physical or electronic method.
For example checks, sales receipt, purchase orders, invoices, account statement, time cards, loan slips etc.
Every source document includes these basic things,
- The amount: sub-total, grand total
- Description of transaction
- Suppliers name
- Customers name
AIMS AND OBJECTIVES :
The aim of this project is to have a clear and detailed report on an exhibition of source documents in college.
- To get a comprehensive information on Source documents.
- To know all the different types of source documents used.
- To know the importance of source document in any business
- To understand the role of various source documents in various departments of the business/firm.
METHOD AND METHODOLOGY :
The method used to make a detailed report is to gather all the information on source documents with the help of internet. Various sites helped in gathering information on this particular project, which helped in making an appropriate report on source documents. The best way to gather information now a day is the internet, as it has an intensive storage of information on any topic. Conducting a research on
the internet about this project; lead us to proper and appropriate information about source documents.
The Following are the questions that give us an in-depth knowledge of source documents:
Firstly, what are source documents?
Secondly, the importance of source documents in any business.
Thirdly, what are the various types of source documents?
Lastly, how source documents help in any business/firms?
This is the common way of making a report. The method used in this report is the basic where information is gathered around these four major points given above.
DETAIL REPORT OF PROJECT :
What are source documents?
The original record of a transaction is called the source document. Source documents are usually used for an internal purpose in an organization. A few examples of source document namely are checks, invoices, sales receipt, purchase orders etc
The source documents are also known as the business paper. These documents help in an accounting department of any business or firm.
These source documents are used to record various business transactions in the physical or electronic document. These documents are used to track the accounting details and transactions in a business.
Importance of source documents:
The source document helps in recording proper exact transaction details. This helps any business in financial analysis. All the source documents cumulate to form a financial statement which is extremely important to any business or organization. Every financial transaction made by a company creates a paper trail which helps to keep tracks in case of incorrect data or misuse of finance etc. In any company, the major focus is on finance. There should be no mistakes in any financial analysis and all the financial transactions should be accounted for. Source documents make the job of easy. It helps in bookkeeping and accounting process. They majorly help in auditing process of a company. Source documents help auditor’s analysis if the financial report of a company is legit or fraud.
Various types and examples of Source documents:
- Quotations: It’s an official paper given to a customer by the company stating the fixed price of a product or service.
- Purchase orders: It’s a type of document stating the detailed goods or services one wishes to purchase.
- Sales orders: It’s a type of document that gives detailed information on the orders placed by customers. It’s a record of that sale in a sequential number to help the company keep track of it.
- Goods received a note: It’s a document of goods that are delivered by the company to the customer. A customer makes this document to keep a track and compares it to purchase order.
- Goods dispatched note: it’s a document of the goods that are dispatched from a company and sent to the customer. This document helps keep a track of the goods in case of theft or fraud.
- Invoice: This document is given to the customer after the goods are delivered by the company. This document contains the details of products received, unit price, subtotal, grand total.
- Receipt: It’s the document that confirms the payment of the purchases.
- Credit note: This document was given to a customer by company/seller when there’s extra payment done or some event that causes a customer to pay less.
- Debit note: This document is sent from customer to seller to request a credit note to an overpayment or return of goods.
- Account statement: the suppliers send an account statement to the credit purchaser on monthly basis.
There are many another source of documents but the above are the important and majorly used.
How do these source documents help in business?
- They avoid any fraudulent activity in the accounting process
- They provide accurate information of each and every transaction made.
- They help keep records of goods and services that are sold and purchased.
- They help keep the accounts in a proper manner.
- They help the company’s auditor while the auditing process.
- They help keep a paper trail in case of any illegal matter or court case.
- They maintain a balance of trust between customers and suppliers.
- They help in income tax cases if any.
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