Glossary
Short, plain definitions of the terms Indian finance and procurement teams use every day.
The money a business owes its suppliers for goods and services received on credit, and the process of recording, approving and paying those supplier invoices.
Using software to handle the invoice-to-payment cycle: capturing invoices, extracting data, checking it, routing approvals and posting to the ERP, so staff only handle exceptions.
The end-to-end process from requesting a purchase (requisition) through quotes, purchase order and goods receipt to invoice matching, approval and payment.
An internal request, usually approval-routed, to buy goods or services, raised before any order is sent to a vendor.
A request sent to vendors asking for prices and terms for specified goods or services, so the quotes can be compared before a purchase order is awarded.
A document a buyer sends a vendor confirming what is being ordered, in what quantity and at what price. It authorises the spend.
A record made when ordered goods are received, noting what was actually delivered. It is the proof of receipt used in matching.
Checking that an invoice agrees with the purchase order before it is approved for payment.
Checking that an invoice agrees with both the purchase order and the goods receipt (GRN), so you pay only for what was ordered and received.
Adds an inspection or quality report to the invoice, purchase order and goods receipt, so payment also depends on the goods passing a quality check.
Automatically spotting an invoice that has already been received or paid, including re-sent or near-identical copies, before it is paid twice.
Auto-generated statements on the GST portal listing the purchases a business has been reported as making from its suppliers. They are compared with the books to confirm which input tax credit can be claimed.
The GST a business has paid on purchases, which it can generally set off against the GST it owes on its sales, subject to GST rules and conditions.
A GST rule under which input tax credit has to be reversed if the supplier is not paid within 180 days, which makes tracking invoice age important.
The set of rules that decides who must approve a requisition, invoice or claim, typically by amount, department or category.
Petty cash is a small cash float for minor expenses. Under the imprest system the float is a fixed amount, spending is backed by receipts, and the float is topped up only to its original amount, so cash plus receipts should always equal the fixed float.
Enterprise resource planning software: the system of record for a company’s accounting and operations. Examples used by Indian businesses include Tally, Zoho Books, Odoo, ERPNext, NetSuite and Microsoft Dynamics.