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Provisional Accounting ​

Provisional accounting ensures your financial books reflect liabilities as soon as goods are received — even before the supplier's invoice arrives. This eliminates the gap between goods receipt and invoice posting, giving you accurate month-end financials.

Why Provisional Accounting Matters ​

In a typical procurement cycle, there is a delay between receiving goods (GRN) and receiving the supplier's invoice. Without provisional accounting, your books show no liability during this gap. This leads to understated expenses and misleading financial reports, especially at month-end or quarter-end close.

With provisional accounting enabled, PayInvoice Next automatically creates a temporary accounting entry the moment a GRN is submitted. This entry records the estimated liability based on the Purchase Order rate.

How It Works ​

The provisional accounting lifecycle has three stages:

Stage 1 — GRN Submitted (Provisional Entry Created)

When you submit a GRN with provisional accounting enabled, PayInvoice Next posts a provisional journal entry:

DebitCredit
Stock / Expense AccountProvisional Liability Account

This entry is based on the PO rate multiplied by the received quantity. Your balance sheet now shows the estimated liability.

Stage 2 — Purchase Invoice Submitted (Provisional Entry Reversed)

When the Purchase Invoice is created and submitted against this GRN, the system automatically reverses the provisional entry and posts the actual invoice entry. No manual action is needed.

Stage 3 — Actual Entry Active

After reversal, only the actual invoice entry remains in your books. The Provisional Liability account balance returns to zero for this transaction.

How to Use Provisional Accounting ​

Enabling the Feature ​

Provisional accounting is controlled by a system-level setting. Check with your administrator that the Enable Provisional Accounting option is active. Once enabled, you will see the Enable Provisional Accounting checkbox on the GRN form.

Creating a GRN with Provisional Accounting ​

  1. Create a GRN from a submitted Purchase Order (click Create > Goods Receipt Note on the PO).
  2. On the GRN form, tick the Enable Provisional Accounting checkbox.
  3. Verify the items and quantities received.
  4. Click Save, then Submit.

PayInvoice Next posts the provisional journal entry automatically on submission. You do not need to create any separate journal entry.

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The GRN Type field on the form indicates whether this is a PO-Based GRN or an Internal GRN. Provisional accounting typically applies to PO-based receipts where the rate is known from the Purchase Order.

Viewing Provisional Entries ​

To see the provisional entry created by a GRN, open the submitted GRN and check the General Ledger section or navigate to the accounting ledger. The entry will show the provisional liability account. After the Purchase Invoice is submitted, you will see both the original provisional entry and its reversal.

SAP Sync for Provisional Entries ​

When SAP Integration is active, provisional entries sync to SAP with their own status tracking. The SAP Provisional Status field on the GRN form shows the current sync state of the provisional entry. This lets you confirm that SAP's books also reflect the provisional liability.

Once the Purchase Invoice is submitted and the provisional entry is reversed, the reversal also syncs to SAP. The Linked to Invoice field on the GRN shows which Purchase Invoice triggered the reversal.

[VERIFY IN SANDBOX] Confirm that the "SAP Provisional Status" field label appears exactly as shown on the GRN form, and verify the available status values.

PayInvoice Next — P2P Documentation v1.0.0-beta

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