BUSINESS BUSINESS DOCUMENTSDOCUMENTS

N WARREN-SWANN WARREN-SWANLEVEL 3LEVEL 3

SANDYS MIDDLE SCHOOLSANDYS MIDDLE SCHOOL20062006

Business DocumentsBusiness Documents Business documentsBusiness documents

A A documentdocument is used in business as proof of a is used in business as proof of a transactiontransaction that took place. that took place.

The only way to keep a record of the various The only way to keep a record of the various transactions is to record them on documents transactions is to record them on documents specifically designed for each transaction.specifically designed for each transaction.

Although it is much more convenient and Although it is much more convenient and effective to record and store documents on effective to record and store documents on computers, paperwork is still an important record computers, paperwork is still an important record in any business.in any business.

NON-FINANCIAL DOCUMENTSNON-FINANCIAL DOCUMENTS business cardsbusiness cards

letterheadsletterheads

Compliment slipCompliment slip

Business documentsBusiness documents

Documents can be divided into two main categories:Documents can be divided into two main categories:

• non-financial documentsnon-financial documents

• financial or transaction documentsfinancial or transaction documents

What are non-financial documents?What are non-financial documents?

• These documents are mainly used for communication in the business.These documents are mainly used for communication in the business.

What are financial or transaction documents?What are financial or transaction documents?

• These documents are used to record business transactions and are These documents are used to record business transactions and are stored for a prescribed period of time.stored for a prescribed period of time.

Format of documentsFormat of documents

• Although the documents contain the same information for a Although the documents contain the same information for a transaction, the format differs according to the requirements of the transaction, the format differs according to the requirements of the business.business.

LETTERHEADSLETTERHEADS

Potential customers get their first Potential customers get their first impression of the business from the impression of the business from the letterheads.letterheads.

Letterheads should be well designed and Letterheads should be well designed and printed as they reflect the identity of the printed as they reflect the identity of the business.business.

All essential contact and legal information All essential contact and legal information required will be printed on the letterhead.required will be printed on the letterhead.

COMPLIMENT SLIPSCOMPLIMENT SLIPS

These slips are smaller and therefore These slips are smaller and therefore cheaper than letterheads, but contain the cheaper than letterheads, but contain the same contact information as a letterhead.same contact information as a letterhead.

They are used when samples, price lists, They are used when samples, price lists, brochures, etc are sent to a potential brochures, etc are sent to a potential customer.customer.

The compliment slip tells the customer The compliment slip tells the customer who the sender is.who the sender is.

FINANCIAL DOCUMENTSFINANCIAL DOCUMENTS

consignment notesconsignment notes

debit notesdebit notes

credit notescredit notes

statementsstatements

receiptsreceipts

chequescheques

FINANCIAL DOCUMENTSFINANCIAL DOCUMENTS letter of enquiryletter of enquiry

quotationsquotations

pro-forma invoicespro-forma invoices

order formsorder forms

invoicesinvoices

advice notesadvice notes

delivery notesdelivery notes

ORDER FORMSORDER FORMS

The purchaser will place an order for the The purchaser will place an order for the goods when he decides to accept the goods when he decides to accept the quotation.quotation.

The price and terms appearing on the The price and terms appearing on the quotation must be repeated on the order.quotation must be repeated on the order.

The quotation is an offer and the order is The quotation is an offer and the order is an acceptance of the offer.an acceptance of the offer.

The two together form a contract of sale.The two together form a contract of sale.

INVOICESINVOICES

When the seller executes the order, When the seller executes the order, he sends an invoice to the buyer.he sends an invoice to the buyer.

This is a formal notification that the This is a formal notification that the goods have been dispatched and the goods have been dispatched and the buyer's account has been debited buyer's account has been debited with the amount due.with the amount due.

PROFORMA INVOICEPROFORMA INVOICE

If the buyer is unknown to the seller, the If the buyer is unknown to the seller, the business will be unwilling to grant credit to the business will be unwilling to grant credit to the buyer. In this case a pro-forma invoice is sent to buyer. In this case a pro-forma invoice is sent to the buyer, stating that the goods will be sent as the buyer, stating that the goods will be sent as soon as the amount on the pro-forma invoice soon as the amount on the pro-forma invoice has been received.has been received.

When a prospective buyer asks for a quotation, When a prospective buyer asks for a quotation, a pro-forma invoice is sometimes sent, which a pro-forma invoice is sometimes sent, which will then serve as a quotation.will then serve as a quotation.

ADVICE NOTEADVICE NOTE

The advice note informs the buyer The advice note informs the buyer that the order is being attended to.that the order is being attended to.

The expected delivery date is The expected delivery date is indicated just before the goods are indicated just before the goods are dispatched dispatched

DELIVERY NOTEDELIVERY NOTE A delivery note is a document which the receiver of A delivery note is a document which the receiver of

the goods signs when goods are delivered.the goods signs when goods are delivered.

The signature indicates that the goods have been The signature indicates that the goods have been received in good condition.received in good condition.

ExampleExample122122 DELIVERY NOTEDELIVERY NOTE February 15, 2000February 15, 2000 Laserprint LtdLaserprint Ltd P O Box 555P O Box 555 WallesleyWA5 8AJWallesleyWA5 8AJ TOYS GALORETOYS GALORE 100 High Street100 High Street WallesleyWA5 7BNWallesleyWA5 7BN Please receive in good order and condition:Please receive in good order and condition:

1,000 letterheads in two colors1,000 letterheads in two colors500 compliment slips in one colour500 compliment slips in one colour

No of parcels: 2No of parcels: 2 Received byReceived by ...Date...Date

CONSIGNMENT NOTECONSIGNMENT NOTE

A consignment note is made out when A consignment note is made out when goods are transported by common carrier.goods are transported by common carrier.

It is a contract between sender and It is a contract between sender and carrier, and sender's receipt.carrier, and sender's receipt.

All the details about the goods, the All the details about the goods, the consignor and the addressee, place and consignor and the addressee, place and time of loading are indicated and recorded time of loading are indicated and recorded on this document.on this document.

DEBIT NOTEDEBIT NOTE A debit note has the same effect as an invoice.A debit note has the same effect as an invoice.

A debit note is used to notify a customer or A debit note is used to notify a customer or supplier that his account has been debited.supplier that his account has been debited.

A debit note is sent when:A debit note is sent when:

Goods ordered are inferior or damaged and Goods ordered are inferior or damaged and retailer returns them to supplier.retailer returns them to supplier.

Retailer has been overcharged by wholesaler.Retailer has been overcharged by wholesaler.

Retailer mistakenly undercharges the customer. Retailer mistakenly undercharges the customer. The letters E & OE at the foot of the invoice give The letters E & OE at the foot of the invoice give the retailer the right to rectify the error.the retailer the right to rectify the error.

EXAMPLE-DEBIT NOTEEXAMPLE-DEBIT NOTEDEBIT NOTEDEBIT NOTEVAT NO. 169345VAT NO. 169345Toys GaloreToys Galore47100 High Street47100 High StreetWallesleyWA5 7BNWallesleyWA5 7BNTelephone 01224 546376Telephone 01224 546376Fax 01224 376 546Fax 01224 376 546

Laserprint LtdLaserprint LtdP O Box 555P O Box 555WallesleyWA5 8AJWallesleyWA5 8AJ

Dr to Toys Galore250Compliment slips delivered shortDr to Toys Galore250Compliment slips delivered short17.50(Invoice 227, dated February 15, 2000)17.50(Invoice 227, dated February 15, 2000)+ 17.5% VAT3.0620.56+ 17.5% VAT3.0620.56

CREDIT NOTECREDIT NOTE A credit note is the opposite of a debit note.A credit note is the opposite of a debit note.

If the debit note is found to be in order and If the debit note is found to be in order and the complaint is valid the supplier will send the complaint is valid the supplier will send a credit note to the customer.a credit note to the customer.

A credit note is sent when the customer was A credit note is sent when the customer was overcharged, the goods received are overcharged, the goods received are inferior, damaged or not according to inferior, damaged or not according to sample.sample.

A credit note means that the customer will A credit note means that the customer will have to pay less or will receive a refund.have to pay less or will receive a refund.

EXAMPLE-CREDIT NOTEEXAMPLE-CREDIT NOTE Laserprint LtdLaserprint Ltd P O Box 555P O Box 555 WallesleyWA5 8AJWallesleyWA5 8AJ Telephone 01224 546376Telephone 01224 546376 February 17, 2000February 17, 2000 Fax 01224 376546Fax 01224 376546 VAT registration no: 222223333Credit note VAT registration no: 222223333Credit note

number: C090TOYS GALORE100 High number: C090TOYS GALORE100 High StreetWallesleyWA5 7BNCredited by StreetWallesleyWA5 7BNCredited by Laserprint Ltd250Compliment slips Laserprint Ltd250Compliment slips delivered short17. 50+ VAT @17.5%3. delivered short17. 50+ VAT @17.5%3. 0620. 560620. 56

STATEMENTSTATEMENT

At the end of the month the seller sends At the end of the month the seller sends the customer a statement of account.the customer a statement of account.

The statement is a copy of the customer's The statement is a copy of the customer's ledger account in the seller's books.ledger account in the seller's books.

The statement reminds the buyer that he The statement reminds the buyer that he must pay outstanding money.must pay outstanding money.

RECEIPTRECEIPT

When Toys Galore pays the When Toys Galore pays the outstanding amount, Laserprint Ltd outstanding amount, Laserprint Ltd will send them a receipt, which will send them a receipt, which serves as proof of payment that they serves as proof of payment that they settled their account.settled their account.

CHEQUECHEQUE

Toys Galore will pay Laserprint Ltd Toys Galore will pay Laserprint Ltd with a cheque.with a cheque.

A cheque is a written instruction to A cheque is a written instruction to their bank to pay Laserprint Ltd on their bank to pay Laserprint Ltd on demand the amount stated on the demand the amount stated on the cheque.cheque.

REVISIONREVISION document used in a business is proof of a document used in a business is proof of a

transaction that took place. transaction that took place. Types of documents:Types of documents:

• non-financial documents - mainly used for non-financial documents - mainly used for communicationcommunication

• financial documents - used to record business financial documents - used to record business transactionstransactions

Examples of non-financial documents:Examples of non-financial documents:

• business cardsbusiness cards

• letterheadsletterheads

• compliment slipscompliment slips

REVISIONREVISION

Examples of financial documents:Examples of financial documents:

• letter of enquiry - seeks information about letter of enquiry - seeks information about product, price and deliveryproduct, price and delivery

• quotation - answer to letter of enquiryquotation - answer to letter of enquiry

• order form - when purchaser accepts quotation order form - when purchaser accepts quotation • invoice - when the seller executes the order he invoice - when the seller executes the order he

sends the buyer an invoicesends the buyer an invoice

REVISIONREVISION

• pro-forma invoice - buyer must pay pro-forma invoice - buyer must pay when ordering goodswhen ordering goods

• advice note - to inform buyer that the advice note - to inform buyer that the order has been dealt withorder has been dealt with

• delivery note - receiver of goods will delivery note - receiver of goods will sign this document when goods are sign this document when goods are delivereddelivered

REVISIONREVISION

• consignment note - used when goods consignment note - used when goods are transported by common carrierare transported by common carrier

• debit note - notification to supplier that debit note - notification to supplier that unsatisfactory goods are returnedunsatisfactory goods are returned

• credit note - document to inform buyer credit note - document to inform buyer that he will pay less or receive a refundthat he will pay less or receive a refund

REVISIONREVISION

• statement - is sent out to remind buyer statement - is sent out to remind buyer that he must pay outstanding moneythat he must pay outstanding money

• receipt - serves as proof of payment receipt - serves as proof of payment that the buyer has settled his accountthat the buyer has settled his account

• cheque - a written instruction by the cheque - a written instruction by the drawer to their bank to pay payee a drawer to their bank to pay payee a specified amountspecified amount

GLOSSARYGLOSSARY Business document-Business document-business activities business activities

are recorded on these documentsare recorded on these documents Business card-Business card-small card with contact small card with contact

numbers and address of person who numbers and address of person who carries itcarries it

Cheque-Cheque-written order to bank to pay written order to bank to pay named person specified amountnamed person specified amount

Compliment slip-Compliment slip-contains same contact contains same contact information as letterhead but is smaller information as letterhead but is smaller and cheaperand cheaper

Consignment note-Consignment note-contract for transport contract for transport between sender, carrier and recipientbetween sender, carrier and recipient

GLOSSARYGLOSSARY

Credit notes-Credit notes-a document to notify a document to notify customer he will pay less or will receive customer he will pay less or will receive a refunda refund

Debit note-Debit note-a document to notify a document to notify customer his account has been debitedcustomer his account has been debited

Delivery note-Delivery note-receiver signs to receiver signs to confirm that goods were received in confirm that goods were received in good ordergood order

Invoice-Invoice-formal notification that goods formal notification that goods have been dispatched and payment is have been dispatched and payment is requiredrequired

GLOSSARYGLOSSARY

Letter of enquiry-Letter of enquiry-request for request for information about a productinformation about a product

Letterhead-Letterhead-all legal and other all legal and other necessary contact information at heading necessary contact information at heading of letterof letter

Order form-Order form-order is completed when order is completed when quotation is accepted.quotation is accepted.

Pro-forma invoice-Pro-forma invoice-sent when payment sent when payment is requested before goods are is requested before goods are despatcheddespatched

GLOSSARYGLOSSARY

QuotationQuotation

a binding offer from seller in response to requesta binding offer from seller in response to request

ReceiptReceipt

proof of payment that has been madeproof of payment that has been made

StatementStatement

summary of most recent trade transactions sent summary of most recent trade transactions sent to customerto customer

TransactionTransaction

deal that takes place between two business deal that takes place between two business partiesparties

Your turnYour turnCreate a slide Create a slide show for the show for the following following documents,Givdocuments,Give brief e brief descriptions.descriptions.

letter of letter of enquiryenquiryquotationsquotationsorder formsorder forms

invoicesinvoicespro-forma pro-forma invoicesinvoicesadvice notesadvice notes

Delivery noteDelivery note

Debit noteDebit note

Credit noteCredit note

StatementStatement

ChequeCheque

receiptsreceipts

Consignment Consignment notesnotes

Delivery noteDelivery note

ReceiptReceipt LetterheadLetterhead

Business Business cardcard

Compliment Compliment slipslip