Procure to pay
In Arabic دورة الشراء حتى السداد
Procure to pay is the full buying cycle, from raising a purchase order through approval, receiving the goods and recording the vendor’s bill, to paying the vendor.
In plain words
Procure to pay is where a business commits its money. Each step is a control: the order says what was agreed, the approval says someone allowed it, the receipt says what arrived, and the bill says what the vendor claims.
In a sound cycle the bill is checked against the order and the receipt before it is paid, so the business pays only for goods it agreed to buy and actually received, at the price it agreed.
The common mistake is paying from the vendor’s invoice alone. Without the order and the receipt beside it, short deliveries and creeping prices are paid in full, and found, if ever, at the year-end audit.
- Ordered, at SAR 8.00 a carton
- 200 cartons
- Received
- 180 cartons
- On the vendor’s invoice
- 200 cartons
- Payable on what arrived
- SAR 1,440.00
In Axon Suite
How Axon Suite handles it
In Axon Suite a purchase order is approved by someone with approval rights before any goods are received against it. The bill is drawn from what arrived at the agreed price, and the vendor is paid from a bank account.
Feature
Approved before the goods arrive
A purchase order starts as a draft, is submitted, and is approved by a user whose role holds approval rights on purchase orders. Until then, no goods can be received against it and no bill can draw on it.
Open: Approved before the goods arrive