What is a Vendor Invoice?

Following with basic financial concepts, what is a Vendor Invoice?

Easy, a Vendor Invoice is an accounting document.

Yes, but what it represents? It’s a “request” for payment of whichever thing we received from a provider.

There are two types of Vendor Invoices:

- Non-purchase order based invoices.

In this case, we have not any purchase order created previously. We have to pay to the provider for some service, for example the rent. The invoice is posted directly in General Ledger, debiting in the expense account and crediting in the vendor Account.

SAP Transaction to create the Non-PO-Based Invoice is FB60 or following the path:

SAP Menu->Accounting->Financial Accounting->Accounts Payable->Document Entry->FB60 – Invoice

Before save (post) the invoice you can simulate with button ‘Simulate’.

- Purchase order based invoices.

In this case, we have a previous purchase order requesting some good or services. Also, that service or good has been received against the purchasing order creating the “Good Receipt” document in MM module, debiting in the Inventory Account and Crediting GR/IR clearing account (this account is used to post goods/services which have not been invoiced.

Once we have received the goods/services we can create the Vendor Invoice referencing the purchase order previously created, debiting the GR/IR clearing account and crediting the Vendor Account.

SAP transaction to create the PO-Based Invoice is MIRO or following the path: 

SAP Menu->Logistics->Material Management->Logistics Invoice Verification->Document Entry->MIRO-Enter Invoice

When you enter de invoice data including the purchase order and post the document, the invoice number document is created. If that document has the status “Blocked for payment”, it is blocked for payment and has to be released before proceed with the payment.

That blocking is performed by the invoice verification process, consisting on match the price and quantity of PO, GR and Invoice (taking into account tolerances). If they do not match, SAP will block the invoice for payment.

To unblock the invoice you can use SAP transaction MRBR or following the path:

SAP Menu->Logistics->Material Management->Logistics Invoice Verification->Further Processing->MRBR-Release Blocked Invoices

Entering the proper data you will able to select the correct invoice to unblock. With the invoice selected, click on the flag button to release it. The status will change to “Released”.