Core Concepts

Understanding core procurement concepts is essential before configuring vendor pricebooks or processing supplier invoices. These concepts explain how procurement documents flow through the ERP and how warehouse receipts impact financial ledgers.

The Procurement-to-Pay (P2P) Document Lifecycle

Procurement transactions follow a structured 5-step lifecycle. Each step represents a distinct legal commitment, inventory movement, and financial milestone.

Step	Document	Business Purpose	Inventory Impact	Accounting Impact
1	Purchase Requisition	Internal department request asking procurement to buy goods	None	None
2	Purchase Order (PO)	Legally binding contract sent to vendor specifying items & prices	Stock Expected (Incoming PO quantity)	None (Commitment recorded)
3	Goods Received Note (GRN)	Receiving slip issued upon physical arrival of goods	Stock Increased (Physical stock-in)	GRNI Accrual (Debit Inventory / Credit GRNI)
4	Purchase Invoice	Supplier’s commercial billing document demanding payment	None (if GRN already executed)	Accounts Payable Credited, GRNI Cleared
5	Vendor Settlement	AP cash disbursement or bank transfer payment	None	Bank Credited, Accounts Payable Debited

Knock-off — how a PO, a GRN and an invoice are tied together

BigLedger has no three-way matching engine. There is no tolerance setting, no variance check and nothing that blocks a supplier invoice because its price or quantity differs from the purchase order. What it has instead is knock-off: when you create a Purchase Invoice you open its KO For tab, pick a finalised Purchase Order or Purchase GRN, and BigLedger copies that document’s supplier, lines and prices into your invoice. Only finalised source documents that are not already fully knocked off appear in the list.

    flowchart LR
  PO["Purchase Order<br/>(Internal)"] -->|knock-off| PI["Purchase Invoice<br/>(Internal)"]
  GRN["Purchase GRN<br/>(Internal)"] -->|knock-off| PI
  PI -->|FINAL| GL["Creditor + purchase<br/>+ input tax journal"]
  PI -->|FINAL| STK["Stock in"]

Matching, in other words, is something you do by eye when you compare the copied lines against the paper the supplier sent. If the supplier billed a different price, you change the line and the invoice finalises anyway. Controls over that live in permissions — who may edit a price, who may finalise — not in a matching rule.

The Knock Off Settings screen is inert. The Purchase Invoice applet has a settings/knock-off-settings route with switches named KNOCK_OFF_BY_PURCHASE_GRN, KNOCK_OFF_BY_PURCHASE_ORDER and similar. Its menu entry is commented out and nothing outside that screen reads the values. The KO For tab offers Purchase GRN and Purchase Order whatever they are set to.

Which document moves the stock

This is the part most new users get backwards, and it decides what your balance sheet shows between receipt and billing.

In the standard flow the invoice moves the stock, not the receipt. Purchase GRN (Internal) records that goods arrived, but its quantity signum is 0 — it books nothing into inventory. Purchase Invoice (Internal) has quantity signum +1: finalising it books the quantities in and updates the item’s last purchase cost. So between delivery and billing, the goods are physically in your warehouse and absent from your stock ledger.

If you need stock booked at receipt and billed later, use the alternative pair instead: Purchase GRN Stock In (Internal) to receive, and Purchase Invoice No Stock In (Internal) to bill. Choose one pair per flow and stay with it — mixing them double-counts.

You want stock to move at…	Receive with	Bill with
Invoice (standard)	Purchase GRN (Internal)	Purchase Invoice (Internal)
Receipt	Purchase GRN Stock In (Internal)	Purchase Invoice No Stock In (Internal)

Core Concepts

The Procurement-to-Pay (P2P) Document Lifecycle

Knock-off — how a PO, a GRN and an invoice are tied together

Which document moves the stock

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