Making a purchase is a process, a flow of activities that need to be done in order to have an accurate transaction in your accounts, all relationships in good shape and the transaction taking place also in reality.

When first making a purchase, depending on the size or procedures in place in your business, there should be something called a purchase order that needs to be considered. In this sense I mean “considered” as implemented or at least the idea and what it imposes should be considered when making the purchase. 

Having done the purchase, it needs to be accounted for. This means you need to enter into your accounting the correct amounts (if you bought goods into your inventory, take on proper units, unit prices etc.), correct party the liability is against (your supplier) and most importantly, accurate payment dates as well.

When it comes to payments of liabilities the purchase generated, it’s crucial for good relationships to always pay on time the latest. You can always pay before the due date, but it’s never a good practice to fall behind on your payments. So having the right due date written down is important.

Another crucial part of the process is ensuring the reality meets what’s written on the invoice or another document you have as a proof of the transaction. Did you really receive those goods written down? Was the service received? It’s ensuring the reality meets the agreement on paper.