Partial Delivery and Advance Payments

This article provides an example of how, in the SEMINE purchase order module, you can handle prepayment of invoices related to orders, where goods are typically not received until completion, but the supplier requires prepayment.

In SEMINE, you can only link invoice lines to purchase orders if the goods have been received. For prepayments, the solution is to use purchase order categories.

Example

1. Creation of order and sending to the supplier
2. Prepayment of 50% of the order
3. Goods receipt and final invoice

1) Generate a purchase order for XYZ in the ERP system and transmit it to the supplier.

The agreement is that a 50% prepayment at the start, with the product and final invoice dispatched upon contract completion.

The order is synchronized to SEMINE, but it is not possible to match invoice lines to the purchase order, as the goods have not yet been received. This is evident from the values in the received and available columns above, which are both 0.

2) Receive an invoice from the supplier for 50% of the net amount, which should be prepaid according to the agreement.

The invoice can be classified as a purchase order invoice during invoice receipt.

In advance, you have set up a purchase order category called "Prepaid," which can be used in these cases. The accounting generates posting on the dimensions and VAT code on the right side of the invoice lines, as well as on the predefined general ledger account. It is not posted against the purchase order when selecting the purchase order category.

3) At the end of the contract, receive the goods and the final invoice, including VAT, from the supplier.

Goods receipt is done in ERP, so the purchase order gets a received status in SEMINE.

The invoice line related to the prepayment is categorized in the same way as the prepayment invoice. These two entries now offset each other (null).

Since the bicycle is now received, the invoice line related to the actual order can be linked to the purchase order, goods receipt, and line number, as shown in the image below.

This way, you account for the prepayment as a receivable that offsets in the accounts, and then expense, or potentially inventory, the invoice related to the actual purchase order. The accounting treatment is therefore correct.