Purchases

Purchases cover what you buy: supplier bills you will pay later, expenses you have already paid, landed costs that belong in your inventory value, and prepaid expenses you recognize over time. They all post to the same ledger as your sales.

Which document to use:

Situation	Document
A supplier sent an invoice you will pay later	Bill
A supplier owes you money back (return, over-billing)	Vendor credit
You already paid, for example by card or cash	Expense
Freight, duty, or insurance should be added to stock cost	Landed cost
You paid up front for a period, such as a year of insurance	Prepaid expense

Bills

A bill records what a supplier has invoiced you. Posting it credits Accounts Payable, so the amount shows as owed to the supplier until you pay it.

Open Accounting → Bills and click New bill. The list has tabs for common views such as drafts, unpaid, overdue, and vendor credits, and filters for supplier, status, and date.

Create and post a bill

Choose the Supplier. Their default payment terms, bill currency, withholding tax category, and payable account are filled in. The supplier list marks suppliers that are · Inactive or · On hold.
Enter the supplier’s invoice number in Reference. A reference can be used only once per supplier, which stops the same invoice being entered twice.
Set the Bill date and choose Payment terms or a Due date.
Choose the Currency and check the Exchange rate if it is foreign.
Add lines. A line with a product calculates Qty × Unit cost; a line without a product is an expense-only line.
Click Save draft, then Post bill.

Once posted, a bill cannot be edited or deleted. To correct it, cancel it or create a vendor credit.

Accounting details

Expand Accounting details to see:

Credit To (Accounts Payable): the payable account for the supplier balance. It comes from the bill, then the supplier’s settings, then the company default.
A Posting account for each line. A line without a product uses the supplier’s Default expense account, or the company’s general expenses account if the supplier has none.
The Input VAT and Purchase price variance accounts.
A ledger preview that shows whether the entry balances.
The Payment schedule when the payment terms have installments.

When a bill posts, each line’s amount is debited to its posting account, tax is debited to Input VAT, and the total (less any withholding tax) is credited to Accounts Payable.

Update stock

Leave Update stock off for a financial-only bill. Product lines then post to the line’s account without changing inventory.

Turn it on when the bill also receives goods. Choose the Inventory location and review the Stock impact. On posting, the products are received into stock and their lines post to Inventory. Cancelling the bill reverses only the stock movement it created.

Foreign-currency bills

Bills work like invoices: each has a currency and an exchange rate to the company currency. The rate defaults to the latest rate on or before the bill date. You can type a different rate; Use rate of … restores the recorded one. The bill shows amounts in its own currency; the ledger always records them in the base currency.

When you pay a foreign-currency bill, Accounts Payable is cleared at the bill’s rate and the bank at the payment’s rate. The difference posts to FX Gain/Loss. Open foreign-currency payables are also included in Currency revaluation.

After posting

Record payment opens a new payment to the supplier, allocated to this bill. See Payments.
Create credit starts a vendor credit against the bill.
Add landed cost (for Update stock bills) starts a landed cost voucher.
Cancel bill posts a reversing entry, dated today, and reverses the stock movement. A bill with a posted payment allocated to it cannot be cancelled until that payment is cancelled.
View ledger (in the ⋯ menu) opens its ledger entries.

Vendor credits

A vendor credit records money a supplier owes you back. It posts the mirror of a bill.

Against a bill: click Create credit on the posted bill. The lines, supplier, payable account, and withholding tax are copied. The credit must use the bill’s currency, and all credits together cannot exceed the bill’s total.
Standalone: on a new bill, tick This is a vendor credit (the supplier owes you back).

If the credit returns stocked products, they leave stock at the current average cost; any difference posts to Purchase Price Variance.

A vendor credit created from a bill is applied to that bill automatically when it posts, reducing its balance and installments; any remainder stays as supplier credit. To use unapplied credit on other bills of the same supplier and currency, click Apply credit on the vendor credit, or on the supplier’s Accounting tab. Applying, unapplying, and voiding work the same way as for customer credit notes. Use Record refund when the supplier pays you back instead.

Expenses

An expense records money you have already spent, so there is nothing to pay later. Examples: a card payment for software, or petty cash for office supplies.

Open Accounting → Expenses and click New expense.
Set the Date and choose Paid from, the bank or cash account the money left.
Optionally choose a Supplier.
Add lines with an Account, amount, and tax rate. If you chose a supplier with a Default expense account, a line left without an account uses it.
Click Save draft, then Post expense.

Posting debits each line account and Input VAT, and credits the Paid from account. Expenses are entered in the base currency. Cancel expense posts a reversal dated today.

Landed costs

Landed costs are extra costs of getting goods into stock, such as freight, customs duty, or insurance. Adding them to inventory value makes your cost of goods sold accurate.

A landed cost voucher applies to posted bills that have Update stock on. The charges themselves must already be recorded, usually on a separate bill from the freight company, to an expense account. The voucher moves that cost from the expense account into inventory.

Open Accounting → Landed costs and click New landed cost, or click Add landed cost on a bill.
Set the posting date and choose Distribute charges by: Quantity, Item amount, or Distribute manually.
Select the stock bills.
Under Taxes and charges, add each charge’s expense account and amount.
Review the Item allocation, click Save draft, then post the voucher from its page.

The part of the cost for goods still in stock is added to inventory value; the part for goods already sold goes to Cost of Goods Sold. The voucher page shows both as Still in inventory and Recognized in COGS. Cancelling reverses both.

Prepaid expenses

A prepaid expense is a cost paid up front for a future period. For example, you pay 12,000 for a year of insurance in January. Instead of 12,000 of expense in January, you want 1,000 each month.

Record the payment first as a posted expense, bill, or journal entry.
Open Accounting → Prepaid expenses and click New prepaid expense.
Choose the Posted expense line, the Amount to prepay, and the Prepaid asset account (defaults to Prepaid Expenses).
Choose the Recognition basis (Exact days or Monthly) and the start and end dates.
Click Save draft, then post the schedule.

Posting moves the amount from the expense account to the prepaid asset. Recognition then moves it back to expense over the period.

Recognition posts automatically at each month end (see Scheduled entries). Recognize through today on the Prepaid expenses page catches up everything due for every active schedule straight away. Cancelling a schedule reverses its recognitions, dated today.

Suppliers

Accounting → Suppliers lists the same suppliers used by bills and inventory; there is no second vendor list. Tabs show suppliers with a balance, overdue, or on hold.

Click New supplier or Edit to manage the name, contact details, Tax ID, Default payment terms, Default expense account (used for bill and expense lines left without an account), Active status, and Bank details (bank name, account holder, IBAN, SWIFT/BIC, account number).

A supplier’s Accounting tab shows outstanding, overdue, credits, open documents, and ledger activity.

Supplier is also available under Settings → Objects and Settings → Properties, where administrators can configure its detail layout and add custom properties. See Objects and Properties.

Supplier accounting settings

On the supplier’s Accounting tab, click Edit on Accounting settings. Leave a setting on Company default to keep following the company-wide value. Settings are stored per company.

Setting	What it does
Put supplier on hold	Stops new bills and/or payments until released.
Block	Bills and payments, New bills only, or Payments only.
Release on	The hold lifts automatically on this date.
Bill currency	Pre-selected on new bills and supplier payments.
Payable account	The Credit To account for new bills.
Pay from	The bank or cash account pre-selected when paying this supplier.
Withholding tax	The category deducted from new bills.

Supplier holds

A hold is useful while a dispute is open or while you are waiting for tax documents.

New bills only blocks saving and posting bills and vendor credits for the supplier.
Payments only blocks paying the supplier.
Bills and payments blocks both.
Refunds received from the supplier are never blocked.

A hold applies to documents dated before the Release on date. A supplier on hold is marked On hold in the list and shows a banner on its Accounting tab.

Withholding tax

Withholding tax is tax you deduct from a supplier’s bill and pay to the tax authority yourself, for example on services from a non-resident supplier. The supplier is owed the bill total minus the withheld amount.

Set up categories

Open Accounting settings → Posting defaults → Withholding tax and click Add withholding tax. Enter a Name, a Rate (%), and the Liability account the withheld amount is credited to. The account must be a liability account other than Accounts Payable.

Categories cannot be deleted, because posted bills keep a copy of them. Clear Active to stop offering one on new bills.

How it works on a bill

Choose a Withholding tax category on the bill, or let the supplier’s default fill it in. Choose No withholding to skip it.

The amount is calculated on the pre-tax subtotal. For example, a bill for 10,000 plus 15% VAT, with 5% withholding:

Account	Debit	Credit
Expense	10,000
Input VAT	1,500
Withholding tax payable		500
Accounts Payable		11,000

The expense and VAT post at full value. The supplier is owed 11,000, shown on the bill as Payable to supplier. The bill’s amount due, the supplier’s balance, Payables aging, and payment allocations all use that net amount. The 500 stays in the liability account until you pay the tax authority, for example with a journal entry or expense.

A vendor credit against the bill reuses the bill’s withholding rate.