I n t e r a c t I v e t e X t foundations in Accountancy/ acca financial accounting (ffa/FA) bpp learning Media is an acca approved Content Provider

credit note

 is a document relating to returned goods or refunds when a customer has been 

overcharged. It can be regarded as a negative invoice. 

 

1.4 Other documents 

The following documents are sometimes used in connection with sales and purchases. 

(a) Debit 

notes 

(b) 

Goods received notes 

A debit note might be issued to adjust an invoice already issued. This is also commonly achieved by 

issuing a revised invoice after raising a credit or debit note purely for internal purposes (ie to keep the 

records straight). 

More commonly, a debit note is issued to a supplier as a means of formally requesting a credit note. 

Goods received notes (GRNs) record a receipt of goods, most commonly in a warehouse. They may be 

used in addition to suppliers' advice notes.  

Note. Although referred to as 'goods' received notes, GRNs can be used as a record that a service has 

been carried out. This is especially the case in electronic purchase order systems where a fundamental 

step in the purchase order process is for the accounts department to match a GRN to a purchase order 

for goods and services received, before paying a supplier's invoice. This is a key control to ensure that 

invoices are not paid if the goods or services have not been received (although there are exceptions to 

this, as some suppliers may require payment in advance).  

Even where GRNs are not routinely used, the details of a consignment from a supplier which arrives 

without an advice note must always be recorded.  

GRNs are also key documents in estimating a company's figure for accrued purchases (accruals) that 

needs to go into the financial statements. This is because they are evidence of liabilities to pay for goods 

or services received, that have not yet been invoiced by the suppliers. The figure goes into the accruals 

account or sometimes more specifically a 'GRNI' account (Good Received Not Invoiced) which forms part 

of the overall accruals figure. Accruals are discussed in more detail in Chapter 10. 

BPP Tutor Toolkit Copy

---

CHAPTER 4  

//

  SOURCES, RECORDS AND BOOKS OF PRIME ENTRY