Business Expense vs Purchase Invoice

ERPNext Accounting
1

Hi,
We have been using tally for our accounting and there my accountant inputs expenses like job work, rent, water bill, electricity bill as indirect expense via gl entry.

I requested him to use purchase invoice in erpNext but he confidently told me that, this is incorrect as purchase should be different from expenses and we need it separately for govt. compliance.

Can anybody confirm, what kind of process should I follow in erpnext? Should I go with indirect expense journal entry or create purchase invoice.

2

Hi there,

This is really a question for your auditors, whoever they may be.

Objectively, it doesn’t really matter whether you use Purchase Invoices or Journal Entries. Both write to the general ledger. Journal Entries are lower level, and Purchase Invoices have more workflows and abstractions built in, but they ultimately do the same thing to your accounts.

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