When auditors start with the underlying source documents and work forward to follow the transaction through to recording in the journal and ledger, this is referred to as ________.
A)audit procedures
B)substantive procedures
C)tracing
D)vouching

Question

Quizplus · Accepted Answer

Tracing involves following a transaction from the underlying source documents through to recording in the journal and ledger. This is often done as part of audit procedures and substantive procedures, but tracing specifically refers to the direction of starting from the source documents and moving forward in the recording process. Vouching, on the other hand, involves starting with the recorded transaction in the ledger and working backward to the source documents to verify the accuracy and completeness of the recorded transaction.

When Auditors Start with the Underlying Source Documents and Work