What is documentation

The paperwork that serves as evidence for the transactions noted in a business’s financial ledgers is a documentation. This paperwork is important for confirming that the financial records are accurate.

Receipts, contracts, and invoices are key examples of this kind of documentation in accounting. These documents serve as proof that transactions have occurred and are valued accurately.

What are the requirements for documentation in accounting?

In the context of accounting best practices, documentation must satisfy specific requirements in order to be considered acceptable. The following is a summary of what accounting standards demand for trustworthy record-keeping:

• Identification information for the purchaser, including name, address, and Australian business number (ABN).
• Details of the seller or service provider, including name and ABN.
• If the business is a company (Pty Ltd, Limited, etc.), the Australian company number (ACN) should be included.
• When applicable, the notation ‘GST registered’ should accompany the seller’s details.
• A unique invoice number.
• The date the invoice was issued.
• A clear description of the goods or services provided, along with quantities.
• The price charged for the goods or services.
• The place and date of delivery for the goods or services.
• The applicable goods and services tax (GST) rate and the total GST charged if the seller is registered for GST.
• The payment due date.

This information pertains to what is known as primary documentation, directly linked to individual transactions in the accounts. In addition to this, secondary documentation, like supplier contracts, customer agreements, and corporate records, also forms part of a robust accounting record system.

Validity of digital invoices

Creating an invoice through an accredited invoicing software platform ensures the production of valid documentation. Such systems automatically assign a sequential number to each invoice and include requisite company information.