Sales Invoice
Sales Invoice
Overview
The Sales Invoice in DIGITZ ERP is a core accounting document used to record the sale of goods or services to customers. It finalizes the sales process and automatically updates ledgers, taxes, and stock records. Each Sales Invoice defines how income, receivables, and tax liabilities are recognized in the system.
Purpose
To record and post sales transactions accurately, ensuring that all related accounts such as income, receivables, and tax are updated automatically. The Sales Invoice serves as the official document for revenue recognition and customer billing.
How It Works
A Sales Invoice can be created directly or generated from preceding documents such as a Sales Order or Delivery Note. When the invoice is created, the system applies pricing, discounts, and tax rules derived from both the Company Configuration and the Item Tax Configuration.
These configurations determine how tax rates are applied, whether the item is taxable or exempt, and how tax postings are made.
Depending on whether the transaction is a Credit Sale or linked to a Payment Mode, the corresponding ledger entries are automatically generated on submission. The document also respects company-level settings such as Rate Includes Tax, ensuring accurate tax handling and posting.
Key Fields
- Customer – The customer to whom the sale is made.
- Posting Date – The date on which the invoice is recorded in the financial books.
- Items / Services – List of products or services sold, including quantity, rate, and amount.
- Taxability – Determines whether each line item is taxable or exempt, based on company and item tax configurations.
- Line Item Discount (before tax) – Allows discounts to be applied to individual items before tax is calculated.
- Rate Includes Tax – Specifies whether the entered rate includes tax. This setting is inherited from the Company Configuration but can be changed at the document level if required.
- Project / Cost Center – Links the invoice to a specific project or cost center to track revenue by segment.
Price Control with Price List
The Price Control with Price List feature allows consistent and rule-based management of item pricing within the Sales Invoice. It ensures pricing accuracy across transactions while supporting flexibility for customer-specific and negotiated rates.
Purpose:
To automate item pricing through predefined price lists while providing configurable options for customer-level pricing and dynamic rate updates.
How It Works:
- Price Lists can be predefined with item rates and assigned to customers. When creating a Sales Invoice (or related document such as a Sales Order or Quotation), the system automatically fetches prices from the assigned price list.
- If a customer does not have a specific price list assigned, the Default Company Price List is used.
- The feature integrates with the Use Customer Last Price setting in Company Configuration, which takes priority. If enabled, the system applies the customer’s last transaction rate instead of the price list rate.
- Optionally, users can save new transaction rates back to the price list to keep item pricing updated for future sales.
This mechanism maintains pricing consistency and control while allowing flexibility for exceptions when required.
Service Billing with Sales Invoice
The Service Billing with Sales Invoice feature enables the creation of invoices for services rendered, with or without stock items. It allows companies to manage both goods and service billing within the same document type.
Purpose:
To facilitate billing for non-stock services, ensuring that service-based transactions are properly recorded without affecting stock ledgers.
How It Works:
- The system allows users to create invoices that include items of type “Service”, or items configured without the “Maintain Stock” flag in the Item Master.
- When such items are invoiced, the system automatically bypasses all stock-related postings (such as stock ledger and valuation entries).
- The accounting entries still record revenue and tax impact as usual, ensuring accurate income reporting while keeping inventory unaffected.
This feature is ideal for businesses that provide services, maintenance contracts, consulting, or mixed sales involving both goods and services.
Optional Update Stock Method
The Optional Update Stock Method within the Sales Invoice allows stock updates to occur directly through the invoice without the need to create a Delivery Note. This is particularly useful in cases where a separate delivery process is not required.
Purpose:
To provide flexibility in managing stock movements directly through sales invoicing, reducing the need for additional documentation steps when delivery notes are not applicable.
How It Works:
- When the Update Stock option is enabled in the Sales Invoice, the system performs stock ledger postings similar to those made through a Delivery Note.
- This means item quantities are deducted from stock, and valuation effects are applied directly upon submission of the invoice.
- If the Update Stock option is disabled, the invoice functions purely as a financial document, and stock is only affected through a separate Delivery Note (if created).
This feature provides flexibility for companies that wish to handle immediate stock reduction through invoicing, especially in simpler sales processes where delivery documentation is unnecessary.
Posting Behaviour
- On submission, accounting entries are automatically generated based on configuration.
- Credit Sales post to the Accounts Receivable account.
- Payment-based Sales post directly to the selected Payment Mode’s linked account (Cash or Bank).
- Income and Tax accounts are updated per the company’s Default Accounts, Tax Configuration, and Item Tax Settings.
- When Rate Includes Tax is enabled, the system separates the tax portion from the item rate before posting to the ledgers.
- Service Items bypass stock ledger entries while maintaining full financial posting for revenue and tax.
- When Update Stock is enabled, the system performs stock and valuation postings similar to a Delivery Note.
- The system adheres to the Perpetual Inventory method, ensuring that every stock movement is reflected immediately in both stock and accounting ledgers for real-time accuracy.
Integration
The Sales Invoice integrates seamlessly with:
Inventory Module – Updates stock quantity and valuation (for stock items).
Accounting Reports – Appears in Profit & Loss, Trial Balance, and General Ledger.
Project Module – Links invoice revenue to the corresponding project or cost center.
Price Lists and Customer Records – Ensures price consistency and traceability across all sales documents.
Customer Ledger – Tracks outstanding balances and collections.
Inventory Module – Updates stock quantity and valuation (for stock items).
Accounting Reports – Appears in Profit & Loss, Trial Balance, and General Ledger.
Project Module – Links invoice revenue to the corresponding project or cost center.
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