You create a purchase invoice or purchase order to record the cost of purchases and to track accounts payable. If you need to control an inventory, purchase invoices are also used to dynamically update inventory levels so that you can minimise your inventory costs and provide better customer service. The purchasing costs, including service expenses, and inventory values that result from posting purchase invoices contribute to profit figures and other financial KPIs on your Role Centre.
You must use purchase orders if your purchasing process requires that you record partial receipts of an order quantity, for example, because the full quantity was not available at the vendor. If you sell items by delivering directly from your vendor to your customer, as a drop shipment, then you must also use purchase orders. For more information, see Make Drop Shipments. In all other aspects, purchase orders work the same way as purchase invoices.
You can have purchase invoices created automatically by using the OCR (Optical Character Recognition) service to convert PDF invoices from your vendors to electronic documents, which are then converted to purchase invoices by a workflow. To use this functionality, you must first sign up for the OCR service, and then perform various setup. For more information, see Incoming Documents.
Products can be both inventory items and services. For more information, see Register New Items.
For all purchase processes, you can incorporate an approval workflow, for example, to require that large purchases are approved by the accounting manager. For more information, see Use Approval Workflows.
The following table describes a sequence of tasks, with links to the topics that describe them.
|Create a purchase invoice to record your agreement with a vendor to purchase products on certain delivery and payment terms.||Record Purchases|
|Create a purchase quote to reflect a request for quote from your vendor, which you can later convert to a purchase order.||Request Quotes|
|Create a purchase invoice for all or selected lines on a sales invoice.||Purchase Items for a Sale|
|Understand what happens when you post purchase documents.||Posting Purchases|
|Perform an action on an unpaid posted purchase invoice to automatically create a CR/Adj note and either cancel the purchase invoice or recreate it so you can make corrections.||Correct or Cancel Unpaid Sales Invoices|
|Create a purchase CR/Adj note to revert a specific posted purchase invoice to reflect which products you are returning to the vendor and which payment amount you will collect.||Process Purchase Returns or Cancellations|
|Prepare to invoice multiple receipts from the same vendor once by combining the receipts on one invoice.||Combine Receipts on a Single Invoice|
|Convert, for example, electronic invoices from your vendors to purchase invoices inside Business Central.||Receive and Convert Electronic Documents|
|Learn how Business Central calculates when you must order an item to receive it on a certain date.||Date Calculation for Purchases|
|Resolve confusion when two or more records exist for the same vendor.||Merge Duplicate Records|
|Manage your commitment to a vendor to purchase large quantities delivered in several shipments over time.||Work With Blanket Purchase Orders|
External document numbers
On purchase documents and journals, you can specify a document number that refers to the vendor's numbering system. Use this field to record the number that the vendor assigned to the order, invoice, or CR/Adj note. You can then use the number later if, for some reason, you need to search for the posted entry using this number.
The Ext. Doc. No. Mandatory field in the Purchases & Payables Setup page specifies whether it is mandatory to enter an external document number in the following situations:
In the Vendor Invoice No. field, Vendor Order No. field, or the Vendor CR/Adj Note No. field on a purchase header
In the External Document No. field on a general journal line, where the Document Type field is set to Invoice, CR/Adj Note, or Finance Charge Memo, and the Account Type field is set to Vendor.
If you select this field, it will not be possible to post an invoice, a CR/Adj note, or the type of general journal line described above without an external document number.
The external document number is included in posted documents where you can search by the relevant number. You can also search using the external document number when navigating on vendor ledger entries.
A different way to handle external document numbers is to use the Your Reference field. If you use the Your Reference field, the number will be included in posted documents, and you can search by it in the same way as for values from External Document No. fields. But the field is not available on journal lines.