Creating PO-Based Invoices

Objectives

After completing this lesson, you will be able to:

  • Generate accurate and compliant invoices that match the purchase orders to avoid invoice errors, rejections, and resubmissions.

PO-Based Invoices

 Purchase order-based invoices are associated with one or more purchase orders. This type of invoice can be created:

  • By suppliers in their SAP Business Network account by performing a PO flip. It converts the PO into an invoice by transferring all relevant PO data to the invoice and enforces buyer business rule validation.​
  • By the Accounts Payable department of the customer when they receive paper PO-based invoices from suppliers not on SAP Business Network. Users need to link the electronic PO with the invoice and enter all taxes, charges or discounts manually.
Note
The SAP Ariba Buying and Invoicing application supports evaluated receipt settlements (ERS). ERS is a business process between the buying organization and the supplier that allows these companies to conduct commerce without supplier created invoices for POs and no-release order contracts. In an ERS transaction, the supplier ships the goods ordered, and the purchaser, upon receipt, confirms the existence of a corresponding purchase order or no-release contract, and verifies the identity and quantity of the goods. ​When this happens the invoice is automatically generated and processed based on the quantity received and the price and accounting details from the PO or no-release contract line item.

Rules for adding taxes and charges to invoices

By default, when you create a PO-based invoice in your SAP Ariba invoicing solution, the taxes on the purchase order are not copied to the invoice. You need to apply taxes on the invoice manually based on the paper invoice received from the supplier. SAP Ariba can configure your site to copy tax, charge, and discount information from the purchase order.​​

Here are some general rules to keep in mind when adding taxes manually to an invoice:

​Taxes - You can add taxes either at the header level or at the line-item level but not at both. At the line-item level, you can add taxes either using multiple tax types or using a single tax code. However, you need to use a common way of applying taxes on all line items. That is, you cannot apply tax types on some line items and tax codes on others.

​​Charges - You can add charges on invoices at the header level and at the line-item level but you cannot add the same charge type at both the header and line-item level. For example, if you add a shipping charge at the header level, you cannot add any shipping charge at the line-item level.

​​Withholding taxes - You can add withholding taxes on invoices either at the header level or at the line-item level but not at both. At the line-item level, you can add withholding taxes either using multiple tax types or using a single tax code. However, you need to use a common way of adding withholding taxes on all line items. That is, you cannot add tax types on some line items and tax codes on others.​​

Discount - You can add a single discount either at the header level or at the line-item level but not at both. The discount amount must be a negative number

Note
Your site can be configured to support PO-based defaulting of taxes, charges, and discounts on manual invoices. In that case, tax, charge type, and discount information is copied from the purchase order.​

​For more information on handling taxes, please review the Creating and Managing Invoices and the Invoicing and Payment Process guide.

Creating a PO-Based Invoice​

Play the video to learn how to create a PO-based invoice in SAP Ariba Buying and Invoicing.

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