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Overview:
Logistics Invoice Verification
Logistics
Invoice Verification is a part of Materials Management (MM). It puts an end to
the purchasing cycle and hands over further processing to Financial Accounting.
The verification process checks the incoming invoices of their content, prices
and other details.
Logistics
Invoice Verification is thus integrated with the components Financial
Accounting and Controlling. It passes on the relevant information about
payments or invoice analyses to these components.
Credit
memos can also be processed, either as invoice reversals or return deliveries.
SAP Recommended Process of Invoice Verification
An
invoice is a document from the vendor containing the payments to be made
against the delivery of goods or services. An incoming invoice can be an
invoice or a credit memo. An invoice is to be used when the vendor charges for
the goods/services he has supplied to MyCompany. A credit memo is to be used when a
return delivery has been made to the vendor due to quality problems or any
other reason.
All
invoices will be parked by commercial department after verification and the
same will be finally booked / posted by Accounts Payable Section. Invoice
verification will also be required in case of import. The invoice verification
will be done on the basis of bank advice in accounts. At the time of final
payment/ release of payment to vendor, adjustment of the advances (if
applicable) will also be done by accounts.
Vendor Invoice
The
invoice is to be entered against the purchase order. The system will suggest
the amount to be invoiced. The invoiced amount would be equal to the value of
the goods/services delivered. The system would not allow excess amounts to be
posted (unless tolerance is devised otherwise).
The
vendor/invoicing party’s details are automatically picked from the master data
record. Details would include the
vendor’s name, address, payment terms, withholding tax etc.
The
invoice entry is to be checked and simulated so that vendor liability can be
created in the system. As soon as the invoice has been parked by the commercial
department (pre-decided),
it would be available for verification and posting by Accounts Payable Section.
Credit Memo
The
term credit memo always refers to a credit memo from the vendor. Therefore,
posting a credit memo always leads to a debit posting on the vendor account.
As
in the case of invoices, credit memos refer to purchase orders or goods
receipts. They are used to correct the purchase order history if the quantity
invoiced was too high, for example, if an invoice was too high or if part of
the quantity was returned.
When
you post a credit memo, the total quantity in the purchase order history is
reduced by the credit memo quantity.
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