Source documents are the physical basis upon which business transactions are recorded. Source documents are typically retained for use as evidence when auditors later review a company's financial statements, and need to verify that transactions have, in fact, occurred. They usually contain the following information:

• A description of a business transaction
• The date of the transaction
• A specific amount of money
• An authorizing signature

Many source documents are also stamped to indicate an approval, or on which to write down the current date or the accounts to be used to record the underlying transaction. A source document does not have to be a paper document. It can also be electronic, such as an electronic record of the hours worked by an employee, as entered into a company's timekeeping system through a smart phone.

Examples of source documents, and their related business transactions that appear in the financial records, are:

• Bank statement. This contains a number of adjustments to a company's book balance....
• Cash register tape. This can be used as evidence of cash sales,...
• Credit card receipt. This can be used as evidence for a disbursement of funds from petty cash
• Credit note. Credit notes act as a Source document for the Sales return journal. In other words the credit note is evidence of the reduction in sales. It can also be a document from a bank to a depositor to indicate the depositor's balance is being in event other than a deposit, such as the collection by the bank of the depositor's note receivable.

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