A consumer receipt proves someone paid. A business invoice has a harder job: it has to survive another company's accounts payable process, which is built to reject anything it cannot match. Most late payments between companies start as an invoice that was queried, not one that was refused.
The parties, by legal name
Your customer's AP team matches your invoice against a vendor record. If the name on the invoice is your trading brand and the vendor record holds your registered entity, the invoice goes to a queue while someone works out whether you are the same company. Use the legal name, the registered address and the tax ID that match the W-9 or the vendor onboarding form you gave them.
The same applies in the other direction. Bill the legal entity that raised the purchase order, not the division or the person who signed it off. In a group with several entities, the wrong one on the invoice means it is booked in the wrong ledger or not booked at all.
The references they match on
In most mid-sized and larger companies, AP matches an invoice against a purchase order and, for goods, a receiving record. This is the three-way match. An invoice with no PO number cannot be matched automatically, so it is routed to a person, who emails the requester, who is on leave.
The invoice number matters for a different reason. AP systems check for duplicates on the combination of vendor, invoice number and amount. Reuse a number, or resend a corrected invoice under the old number without saying it replaces the first, and it will be held as a possible duplicate. Corrections go out as a credit memo against the original, followed by a new invoice under a new number.
Dates and terms
Three dates, each doing a different job:
| Date | What it does |
|---|
| Invoice date | The date the payment terms run from |
| Service period | The month your customer's cost belongs to |
| Due date | Invoice date plus the terms, printed, never left to be worked out |
Printing the due date removes an argument. Printing the service period helps your customer accrue the cost in the right month, which on a month-end close is often the difference between an invoice processed this week and one held for the next period.
For early-payment discounts, 2/10 Net 30 means the customer may take 2 percent off if they pay within 10 days, and otherwise owes the full amount in 30. This tool takes the discount off the subtotal and leaves the tax in full unless you tell it otherwise, and prints the amount and the date, because practice varies.
Tax
This tool does not decide whether a sale is taxable, at what rate, or in which jurisdiction. You enter the rate on each line and the tool does the arithmetic, rounding tax line by line so the printed lines always add to the printed total. Tax treatment depends on what you sold, where it was delivered, and whether the customer gave you an exemption or resale certificate, and those are questions for your tax team or adviser.
Remit-to details, and the fraud they attract
Invoices carrying bank details are the raw material of payment redirection fraud: a lookalike email tells your customer your bank account has changed, and the next payment goes to someone else. Your customer's AP team loses the money and you lose the receivable. A line on every invoice saying your bank details will not change by email, and naming who to call if they appear to, gives their AP team a reason to stop and check. The tool prints one by default.
