This document outlines the process for procuring and paying for goods and services. It shows the flow of an order from requisition, to purchase order, to goods receipt and invoice verification. The vendor is then paid by debiting an expense account and crediting accounts payable, reducing the liability. The goods are recorded by debiting inventory and crediting the expense account.

1. Asset
G/L accounts  Cost center
Dr. Vendor
Internal Order ,WBS Dr Vendor
Cr. Bank
Material  Profit Centre
FI/CO
No FI Posting
MM
Increase
Inventory
Account
Assignmen
t
AP
invoice
Dr. GR/IR
Cr.
Vendor
Vendor
Payment
Goods
Receipt
Invoice
Verificat
ion
Purchase
Order
Requisiti
on for
Goods
/Service
Dr.
Material
Cr.GR/IR