cash & bank payments through journal entries (IFRS)

[dinuka viduranga]

HI,

Just want to clarify whether IFRS is allowed to post bank and cash entries though journal entries without entering to separate vouchers. we use SAP system and we have separate outgoing & incoming payments modules but still system allows to make entries directly as journal entities which is easy way. we have many transactions such as internal bank transfers loan settlements what we directly make in JV without entering bank vouchers.pleas advise with IFRS requirements.

 

[Steve-LevelUp]

To my knowledge, IFRS does not dictate the required backup for specific entries, only that entries represent real economic activity. Ultimately, auditors will need to be able to see that the transactions you are making did actually occur. So, if you were to use a GL entry for a bank transfer (from one bank account to another) then so long as the amounts match the bank, then a GL entry is sufficient. In the end, the bank statement is the backup showing the transfer.