Plain definition
Source documents are the original or reliable records that support a transaction. Depending on the transaction, they include a contract, approved purchase order, supplier invoice, goods-received note, customer acceptance, bank confirmation, receipt, payroll register, or credit note. Each document answers part of a different question: who authorised the commitment, what was delivered, how much was billed, and whether payment occurred.
A document is useful only when it can be linked to the entry and retained so a reviewer can understand the transaction later. An approved purchase order alone normally authorises an intended purchase; it does not prove that goods arrived or that an invoice is accurate.
Illustrative example
Monetary examples use Saudi riyals (SAR). The same principles apply in other currencies.
A retailer receives 50 display units at each. Purchasing provides the approved order for , the warehouse records receipt of 50 units, and the supplier invoice also states . Accounts payable matches the three records before entering the bill. If the invoice said or referred to 60 units, the mismatch would be held for investigation rather than paid automatically.
The figures are hypothetical. A three-way match supports quantity and price, but it does not replace judgment about quality, contract terms, or delegated authority.
Why it matters
Without an evidence trail, an apparent expense can be a duplicate bill, a fictitious supplier, or a cost placed in the wrong period. The error then becomes harder to correct because the people who ordered or received the goods may no longer remember the facts.
Practical consequence
For each material transaction type, specify the required evidence, the person who approves it, and where it is stored. Link the ledger entry or invoice ID to that evidence. Before close, report missing receipts, delivery confirmations, or approvals to the accountable owner; do not solve a missing document by treating an unsupported amount as automatically valid.