The Purchasing Process

The process outlined to the left has the following benefits:

• Checks are made to ensure the best value purchase is made
  
  
• Ensures that goods are not ordered unless the purchase has been approved (Purchase Order)
  
  
• The receiving of goods is formally acknowledged. Checks are made that the goods received are the goods ordered.
  
  
• Invoices received are checked against purchase orders and delivery dockets.
  
  
• Invoices are “processed” through accounting system i.e. Purchases Journal, Accounts Payable Ledger. This allows the business to keep track of its expenditure and to have more control over its liabilities (amounts owing to Creditors).
  
  
• When statements are received from suppliers they are reconciled i.e. transactions on the statement are checked for differences / discrepancies with our accounting records. Reconciliations performed regularly will ensure that the accounts payable system is correct.