Create purchase invoice from bank transaction

I often have bank transactions, where I haven’t registered the purchase invoice yet. It would be a nice addition to have a button to convert a bank transaction to a purchase invoice.
It should:

  • use the same date
  • copy the account and VAT entries to the invoice
  • alter the account of the bank transaction to account → creditors → this invoice.
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If you convert a bank transaction to a purchase invoice as you suggest, it would no longer be a bank transactions and you would have to re-create it.

Also, if you have VAT on purchases, then you should not have VAT on the payments as well - otherwise you are accounting for the VAT twice!

Why would it be the same date?

Many businesses purchase goods & services on credit.

If you do not purchase on credit, then you have no need to create a purchase invoice

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It seems poor practice to be automatically altering previously entered transactions. In addition to @Joe91’s warning about doubling the tax accounting, you would also have trouble with line items.

I suspect you imagine a situation where you have paid for a single line item. Perhaps you have paid a utility bill. Now you want to be able to copy the payment to a purchase invoice for the same supplier. You would want the purchase invoice to post the line item to a Utilities expense account and change the payment to Accounts payable > Utility Company > PI#. That might work in your scenario.

But the program has to account for other situations. For illustration, suppose someone has a payment with three line items:

  • Inventory item A posted to one asset control account. These goods were taxed.
  • Inventory item B posted to a second asset control account. These goods were exempt from tax.
  • Shipping charges posted to an expense account.

Now complicate the situation by adding the fact that the quarterly tax filing has already been made before the purchase invoice is created, and local tax regulations separate cash and credit purchases. What do you do?

Take things one step further. What happens to the shipping charges. Do you now convert them to freight-in costs so they are distributed and capitalized with the inventory in the asset control accounts? (That could only happen on purchase invoices, not payments.) And how do you handle the fact that someone might try to make this conversion after an accounting period is closed, financial statements have been prepared, and taxes have been filed?

My point is that what seems straightforward on first thinking can become horribly complex and confusing when rolled out into the world. Could all this be handled? Yes, but is it worth it, considering what would be needed to prevent unforeseen consequences? Probably not.


Do you mean that you have not created an invoice before getting paid? Why use an invoice and not issue a receipt, especially as you refer to “same date”. Basically you need to edit the imported bank transaction in receipts and add the items there. The view and email or print, etc to customer.

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The topic is about payments and purchase invoices.

Sorry, you are right. However the question is similar but I should have written payment rather than receipt.

I have two use cases:

1 - sometimes the amount is already deducted from the bank, and I need to “adjust the date” because they payment and invoice were in different quarters/years, which means creating the invoice, correct the date, and link the payment to the invoice

2 - For certain suppliers I prefer to have the invoices in the invoice list, as things can get unclear if it’s mixed.

With “convert”, I didn’t mean actually convert, but to create an invoice based on the transaction, copying the entered data, and linking the transaction to the invoice.

That’s in the ideas list and hopefully will be added at some stage

Hi Joris,

This is poor accounting practice. Purchase invoices are registered when actually received.

There is no need for bank transactions and it’s purchase invoice to be in the same quarter. The first concerns your balance, the second your P&L.

Your VAT concerns only your P&L in this case only your purchase invoice.

I’m sorry, but your idea is in my opinion not a valid use case.

I don’t see how it’s anything different from booking things on the bank tx. The shipping charges is totally irrelevant as an example, because you face the same ‘problems’ in both banktx as purchase invoice.

My question is also not about taxfilings or whatever. It’s a convenient way to create a purchase invoice. Just like there’s a convenient way to create a credit-note from an invoice, etc etc etc.

If I see TX1, and need to create a purchase invoice for it, it’s cumbersome to click, create it, copy info, go back, find the right tx, and post it on the creditors->xxxxxx->invoice

Well sure, in the “perfect” world, you’d add every invoice, receipt separately etc. In that case simply remove the possibility to book banktransactions to any P/L account. Because it’s “bad accounting”.

In practice it works differently. You pay something, get the invoice at a later stage. Sometimes it works the other way.

One day you directly book the bank tx to an account. Another day you register the invoice.

The VAT was just an example of the fields available that should be copied / moved.

Sorry but I do not understand why any seller would provide an invoice after receiving your payment? They should only give you a receipt because there is no lag in payment period involved (credit period).

With direct debit (or credit cards), it’s very common to have the money deducted before receiving an invoice

No problem! Understand that the invoice has more details than a receipt and thus better for record purposes also.

By this are you actually wanting the supplier reports to include the “cash” purchases?

If so the intention is Manager should do what you are describing completely automatically. Or at least that is the intention of the idea linked above.

I don’t have a problem with this but if payment is created by importing bank statement, then wouldn’t this be better to be concieved in payment rules?

In other words, payment rule could create purchase invoice and link it up with the actual payment.

That’s an idea from left field.

I can see functionally eliminating “cash” transactions and replacing them with quick invoice payment/receipt pair may make the program perspective more consistent however I’m less sure about

  • Increased user complexity distributing a single user entry over 2 tabs / data entry location

  • updating historical records to take advantage of reporting associated with the new data entry model.

To follow my interpretation of this idea through

  • Bank rules could have a create invoice option which would 1) create an invoice based on the bank rules 2) Link the payment/receipt to Accounts receivable/payable → Customer/Supplier → invoice number

  • Cash sales/purchases could be done from the invoice tab by adding an option for “Cash” Sale/Purchase enabling selection of a bank account and resulting in generation of a payment/receipt to Accounts receivable/payable → Customer/Supplier → invoice number

  • A “Move to invoice” option analogous to the existing “Copy to” menus could be used to convert payments/receipts entered the old way (resulting in creation of an invoice and linking the receipt/payment to it). I suspect is the button @joris_manager would really like with the current program design.

Overall this sounds like a major change in Managers user interface. It may work well but I worry it is more complex than just showing current “Cash” transactions in customer/supplier reports.

I think the discussion has gone astray. @joris_manager did not mention bank statement imports. He just wants to copy a transaction.

While I do not think that makes for good practice, that is mostly because of the complexity it introduces when transactions involve multiple lines and accounts. But all this other discussion sounds worse, that is, even more complex.

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Does it matter how the bank transaction was originated.
I think @lubos is right on the money with his suggestion with regards to bank statement imports. For the direct entries, you just need a “Create Invoice” button.

To be clear, this would be for imported bank statements (but of course could be used for cash transactions/manual entries too). Maybe it’s more clear if the functionality is not called “convert to purchase invoice”, but to “Create Purchase Invoice for this Transaction”.