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Diff. B/w Invoice & Performa Invoice

Statutory Audit 3640 views 3 replies

Hello

1) What is difference between Invoice & Performa invoice?

2) An expenditure can be booked into accounts based on performa invoice?

3) Is answer to second point still be YES, if a capital asset is purchased or made on contract basis( performa invoice raised by contractor in between)?

Thanks

Replies (3)

Dear ankit,

 

Proforma Invoice

 

This is merely a quotation giving the estimated cost of the goods or service.

 

This is not a supporting document and it has to be followed by an invoice.

 

Where a good policy for procurement of goods and services exists, a quotation is asked for and the cost estimate is provided by the supplier in a proforma invoice.

 

A good procurement policy should aim at obtaining the best goods or services at the most competitive and economic cost for the required purpose.

 

An organization invites quotations,bids or cost estimates and the suppliers provide such estimates through proforma invoice.

 

 

Invoice:

This is a credit bill.

      (i.e) a bill for goods and/or services provided where the payment is yet to be made.

 

This by itself is not a supporting document for payment

 

It has to be supported by a receipt acknowledging the payment towards the invoice.

 

A proper invoice should contain complete particulars

 (i.e) Name of the organization

        Serial number

        Date

        Descripttion of goods and/or services provided

        It should be signed

 

 

Expenditure can not be booked into accounts based on proforma invoice

 

 

 

Regards

 

K.Ilayaraja.

 

 

You have to book expenses or Assets based on Invoice.

Normally advance payment is made on the basis of Perfoma Invoice. Perfoma invoice gives an idea of quantity and value of invoice.


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