![]() Credit memorandums received by departments from vendors represent funds owed to the University and should be entered into the BuyWay or forwarded to the Accounts Payable Department immediately. ![]() When purchase order transaction is created ,reservation is made against the budget in the departmental accounts. When accepted by the seller, it becomes a contract binding on both parties.Ī purchase order sets forth the descriptions, quantities, prices, discounts, payment terms, date of performance or shipment, other associated terms and conditions, and identifies a specific seller. An invoice is also known as a bill or sales invoice.Ī buyer-generated document that authorizes a purchase transaction. If goods or services were purchased on credit, the invoice usually specifies the terms of the deal, and provide information on the available methods of payment. If the buyer has already paid the full amount of the invoice, the buyer has the option of either using the credit memo to offset a future payment to the seller, or as the basis for demanding a cash payment in exchange for the credit memo.Ī vendor, also known as a supplier, is an individual or company that sells goods or services to someone else in the economic production chain.Īn invoice is a commercial document that itemizes a transaction between a buyer and a seller. If the buyer has not yet paid the seller, the buyer can use the credit memo as a partial offset to its invoice-based payment to the seller. Definitions TermĪ credit memo is a contraction of the term "credit memorandum," which is a document issued by the seller of goods or services to the buyer, reducing the amount that the buyer owes to the seller under the terms of an earlier invoice.The credit memo usually includes details of exactly why the amount stated on the memo has been issued, which can be used later to aggregate information about credit memos to determine why the seller is issuing them. All procedures, coordination and approvals are required to take place in order to comply with set policies. As with any other payment issued by the University, standard operating procedures apply to all transactions, including credit memos. This policy applies to all vendors, University departments, Accounts Payable department and University staff who approve and process invoices and credit memos.
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