You may have noticed when you are in a shop or any other establishment that takes your money, that when you hand over a note the assistant might perform a check on it by running a special pen over the paper, or holding the note under an ultra-violet scanner to verify that the note is genuine. These are hi-tech solutions to an increasingly hi-tech problem, as forgers produce ever more realistic looking fakes.

Before all of this gadgetry the only check that was performed on paper money was to look for the watermark by holding it up to the light. For years the watermark stood as the stamp of authenticity on a banknote, as it was very difficult to replicate by the amateur. Small wonder then, that one of the most lucrative thefts of the mid-Victorian era was not of money or jewellery, but of banknote paper that was watermarked and ready for printing.

Modern banknotes have various devices to try and thwart the forgers but the reliable old watermark is still there doing its bit, and we can add watermarks to our Word documents. These can be very useful in establishing the status of a document and they can be made up of text, such as "confidential", "sample", "first draft"etc, or they can contain an image, of a company logo for example. A watermark sits behind the text of a document so that it catches the eye of the reader, and adding one to your Word document is a simple process.

To add a text watermark in Word 2002 & 2003, open a document and go to Format>Background and select Printed Watermark. In the dialog box you will see several default options for commonly used watermarks, but we are going to create our own. Select Text Watermark, and in the text box, type what you want your watermark to say ('confidential' is a good one if you want everyone in the office to read your document). Select your font, colour and size as you would when performing similar tasks in Word, and ensure the Semitransparent check box is ticked. Finally, choose whether you want your watermark text to be diagonal or horizontal and click OK.

In Word 2007, open a document and click on the Page Layout tab and select Watermark from the Page Background group. Select Custom Watermark and click on Text Watermark. Select your font and other formatting as above and click OK.

To add a picture watermark to a document in Word 2002 & 2003, open a document and go to Format>Background and select Printed Watermark. Click Picture Watermark, then Select Picture. Browse for the picture you want and then click Insert. Click Auto in the Scale box and ensure the Washout box is checked. Click OK.

In Word 2007, open a document and click on the Page Layout tab and select Watermark from the Page Background group. Select Custom Watermark and click on Picture Watermark. Click on Select Picture and choose your image. Click Scale and check the Washout box.

To change or remove a watermark, go through the initial stages as above until you get to the dialog box from which you selected Custom Watermark. To change the text of your watermark, re-click the Custom Watermark button update your text and formatting as before. To delete the watermark click the Remove Watermark button.

Watermarks are a simple and effective way of passing on added information about a document. Text watermarks inform the reader as to the status of a document, and a barely visible company logo beneath the text of a letter adds a real touch of professionalism.