Accounting Documents :
Purposes of issuing practical accounting documents
| Accounting Documents | Purposes |
| a. Quotation | A formal statement of promise (submitted usually in response to a request for quotation) by potential supplier to supply the goods or services required by a buyer, at specified prices, and within a specified period. A quotation may also contain terms of sale and payment, and warranties. Acceptance of quotation by the buyer constitutes an agreement binding on both parties. |
| b. Invoice | An invoice is a commercial document issued by a seller to a buyer, relating to a sale transaction and indicating the products, quantities, and agreed prices and discounts (if any) for products or services the seller had provided the buyer.
It shows the date of shipment and mode of transport, delivery and payment terms. In certain cases (especially when it is signed by the seller or seller’s agent), an invoice serves as a demand for payment . |
| c. Official receipt | A receipt is a written acknowledgment that a specified payment has been received. A receipt records the sale of goods or provision of a service. |
| d. Delivery note | A document accompanying a shipment of goods that lists the description, and quantity of the goods delivered. A copy of the delivery note, signed by the buyer or consignee, is returned to the seller or consignor as a proof of delivery. |
| e. Purchase order | A buyer-generated document that authorizes a purchase transaction. When accepted by the seller, it becomes a contract binding on both parties.
A purchase order sets forth the descriptions, quantities, prices, discounts, payment terms, date of performance or shipment, other associated terms and conditions, and identifies a specific seller. |
| f. Purchase Request | Document generated by a user department or storeroom-personnel to notify the purchasing department of items it needs to order, their quantity, and the timeframe. It may also contain the authorization to proceed with the purchase. Also called purchase request or requisition. |
| g. Goods received note (GRN) | Record of goods received at the point of receipt. This record is used to confirm all goods have been received and often compared to a purchase order before payment is issued. |
| h. Sale order | A seller-generated document that authorizes sale of the specified item(s), issued after receipt of a customer’s purchase order. A sales order is an internal document of the company, meaning it is generated by the company itself. A sales order should record the customer’s originating purchase order which is an external document. Rather than using the customer’s purchase order document, an internal sales order form allows the internal audit control of completeness to be monitored as a sequential sales order number can be used by the company for its sales order documents. |
| i. Payment Voucher | A document which can be used as proof that a monetary transaction has occurred between two parties. In business, a payment voucher can be used for a variety of purposes, sometimes taking the place of cash in a transaction or indicating that an invoice has been approved for payment. |
| j. Petty Cash voucher | A record of expenditure from a petty cash fund for which a receipt was not received. Petty cash funds are maintained to provide a company with fast access to small amounts of cash for minor, non-routine purchases. Petty cash vouchers are used to maintain financial control of petty cash accounts, preventing abuse or mismanagement of the funds. |
Issuing Departments and Receiving Departments
| Accounting Documents | issuing Departments | Receiving Departments |
| a. Quotation | Filled out by seller. | send to buyer |
| b. Invoice | An invoice is a commercial document issued by a seller/supplier to a buyer. | Accounting and finance department, buyer |
| c. Official receipt | issued by accounting and finance department, seller | send to buyer |
| d. Delivery note | provided by supplier with delivery | received with goods by store department, buyer |
| e. Purchase order | filled out by buyer, purchasing department | send to supplier |
| f. Purchase Request | filled out by store department | Sent to purchasing department |
| g. Goods received note (GRN) | a document produced by store department | sent to accounting and finance department |
| h. Sale order | The Sales order, sometimes abbreviated as SO, is an order issued by a business to a customer. A sales order may be for products and/or services. A sales order is an internal document of the company, meaning it is generated by the company itself. | The Sales Order is a confirmation document sent to the customers before delivering the goods or services. Sales Order (SO) can be created once the quote is accepted by your prospective customer (potential) and the Purchase Order (PO) is sent by the customer for further processing. |
| i. Payment Voucher | filled out by accounting and finance department | received payment by supplier/seller |
| j. Petty Cash voucher | filled out by accounting and finance department | received payment by supplier/seller, but in practice, signature on petty cash voucher may not be provided by supplier/seller |