Financial documents and their uses
In this task I will be defining the different financial documents and also explaining their uses
and the purposes of them. I will be using Digitech Ltd as an example.
Purchase order
A purchase order is a document provided by a buyer and given to the seller. It indicates
quantity, type and agreed prices for products and services that the seller will deliver to the
buyer. Digitech would provide a purchase order for their buyer.
Delivery note
A delivery note is a document that explains the contents of a package. It is given to the
purchaser by the supplier for proof of goods delivery. The camera shop would receive a
delivery note with their goods as Digitech delivers them.
Goods received note
A goods received note is a record of goods that have been received at the point of receipt. It is
used to confirm that all goods have been received. It is issued by the purchaser. A goods
received note would be issued by the camera shop for Digitech.
Sales/purchases invoice
A sales/purchases invoice contains details of goods, prices, VAT and discounts in full. It is
related to a sale transaction and is issued by a seller to the buyer. Digitech would provide the
camera shop with a sales/purchases invoice.
Credit note
A credit note is issued by the seller if any products are returned by the buyer. Digitech would
issue the camera shop with a credit note if required.
Statement of account
An account statement is a summary of financial transactions that have happened over a given
period of time on a bank account held by a business. Digitech would have an account
statement so that they have a record of their financial transactions.
Cheques
A cheque is an order to a bank to pay a stated sum from an individual’s account. It is an
alternate method of payment from cash or card. Digitech may use a cheque as a method of
payment to pay their suppliers.
Debit card
A debit card is a card which allows the holder to transfer money electronically from their
bank account in order to make a purchase. Another alternate source of payment. Digitech
may use a debit card to pay for equipment with the intention to pay the bank back at a later
date.
Credit card
A credit card is a card that has been issued by a financial company such as a bank. The holder
of the card is given the ability to borrow money at the point of sale, which would need to be
paid back at a later date. Digitech can use a credit card to pay for equipment or suppliers.
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In this task I will be defining the different financial documents and also explaining their uses
and the purposes of them. I will be using Digitech Ltd as an example.
Purchase order
A purchase order is a document provided by a buyer and given to the seller. It indicates
quantity, type and agreed prices for products and services that the seller will deliver to the
buyer. Digitech would provide a purchase order for their buyer.
Delivery note
A delivery note is a document that explains the contents of a package. It is given to the
purchaser by the supplier for proof of goods delivery. The camera shop would receive a
delivery note with their goods as Digitech delivers them.
Goods received note
A goods received note is a record of goods that have been received at the point of receipt. It is
used to confirm that all goods have been received. It is issued by the purchaser. A goods
received note would be issued by the camera shop for Digitech.
Sales/purchases invoice
A sales/purchases invoice contains details of goods, prices, VAT and discounts in full. It is
related to a sale transaction and is issued by a seller to the buyer. Digitech would provide the
camera shop with a sales/purchases invoice.
Credit note
A credit note is issued by the seller if any products are returned by the buyer. Digitech would
issue the camera shop with a credit note if required.
Statement of account
An account statement is a summary of financial transactions that have happened over a given
period of time on a bank account held by a business. Digitech would have an account
statement so that they have a record of their financial transactions.
Cheques
A cheque is an order to a bank to pay a stated sum from an individual’s account. It is an
alternate method of payment from cash or card. Digitech may use a cheque as a method of
payment to pay their suppliers.
Debit card
A debit card is a card which allows the holder to transfer money electronically from their
bank account in order to make a purchase. Another alternate source of payment. Digitech
may use a debit card to pay for equipment with the intention to pay the bank back at a later
date.
Credit card
A credit card is a card that has been issued by a financial company such as a bank. The holder
of the card is given the ability to borrow money at the point of sale, which would need to be
paid back at a later date. Digitech can use a credit card to pay for equipment or suppliers.
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