Glossary
Source document
The original paperwork that proves a transaction happened.
What it means
A document such as an invoice, receipt or credit note that provides the evidence and detail for an accounting entry.
Example
An invoice is the source document for recording a credit sale.
Why it matters
Every entry should trace back to a source document; they feed the books of prime entry.
In practice
Source documents are the starting point of the recording process. They feed the books of prime entry, which are then posted to the ledgers, so nothing enters the accounts without paperwork behind it. An invoice supports entries in the sales or purchases day book. A credit note supports the returns books. A receipt or paying-in slip supports the cash book. A cheque counterfoil is evidence of a payment.
For example, an invoice showing goods sold for RM750 is the authority for debiting the customer and crediting sales.
Students often confuse a source document with a book of prime entry. The source document is the original proof of one transaction. The book of prime entry is an internal list that groups many such documents before ledger posting. Keeping source documents also supports checking and audit, because each figure in the ledger can be traced back to a dated, numbered piece of evidence.
If you are unsure which document leads to which entry, one of our teachers can go through a pack of documents with you. Book a trial class.
Related terms
Syllabus reference: Cambridge 0452 and 0985, syllabus for 2027 to 2029, sub-topic 2.2 Business documents (page 12).
Definitions here are general accounting explanations for study. For your board's exact wording, see its official syllabus via Sources.
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