How to handle a partial delivery against one purchase order

Short answer

1. Note what was delivered against each PO line.
2. Check the invoice bills only that.
3. Leave the PO open.
4. Work out what is left to bill.
5. Close the PO on the final invoice.

Before you start

You need the PO, the delivery dockets and each invoice from the supplier. You also need one place to record the balance. A spreadsheet works. Partial deliveries are common in construction, wholesale and manufacturing, where a supplier ships what is in stock and the rest follows.

The manual way in Xero

1. Go to Purchases > Purchase orders and open the approved PO.
2. Enter the first invoice under Purchases > Bills > New bill. Bill only the lines and quantities delivered.
3. Approve the bill. Leave the PO status as Approved. Do not set it to Billed.
4. In your tracking sheet, write the PO line quantity, the quantity billed and the quantity left.
5. Repeat for each delivery. Before approving each new bill, check the running total against the PO.
6. On the final invoice, approve the bill and set the PO status to Billed.

The limits: Xero treats a PO as either open or billed. It has no field that says 40 percent billed. You carry the balance yourself, and each person who handles the PO must keep the sheet current. A bill that takes the total past the PO is not flagged.

The Pulsify way

1. Forward each invoice to your Pulsify address. Pulsify links it to the open PO from the PO number on the invoice.
2. It matches invoice lines to PO lines on quantity and unit price. A lower quantity is accepted as a partial bill.
3. The PO panel on the invoice shows the share of the PO claimed including this invoice, and what remains. It counts invoices approved in Pulsify against that PO.
4. Pulsify flags a line that bills more than ordered, a different unit price or a line not on the PO.
5. Switch on Close Purchase Order only for the final invoice. Approving it then closes the PO in Xero.

Pulsify counts only invoices approved in Pulsify. Bills entered straight into Xero are not in the total.

Worked example

Example Plumbing Supplies orders 200 bags of cement at $14.00 on PO-2210. That is $2,800.00 ex GST.

Invoice	Qty billed	Amount ex GST	Total billed	Left
INV-501	80	$1,120.00	$1,120.00	120 bags, $1,680.00
INV-538	70	$980.00	$2,100.00	50 bags, $700.00
INV-577	60	$840.00	$2,940.00	Over by 10 bags, $140.00

The third invoice bills 60 bags when only 50 were left. Pulsify flags the line as exceeding the PO by 10. Ask the supplier whether 10 extra bags arrived. If they did and you want them, update the PO. If not, ask for a credit note. Without a tracking sheet or a tool, nobody sees it until the PO is checked at month end.

Who keeps the balance

Pick one owner for each open PO. That person records each delivery, checks each invoice against the balance and closes the PO on the last bill. When two people share a PO the balance drifts, and the supplier ends up billing the difference. A short weekly look at open POs older than 30 days catches the ones where the last delivery never came.

Common mistakes

• Closing the PO after the first invoice. The balance disappears and later invoices have nothing to match.
• Billing the full PO on the first invoice. Some suppliers do this for deposits. Agree the terms in writing.
• Tracking in two places. If one person keeps a sheet and another approves in Xero, the balances drift apart.

Next step

Try an invoice and see the claimed and remaining amounts on your own PO. Or book a call to find out how customers have saved hours per week after switching.

The PO matching guide covers the PO panel in full. Try the free PO and invoice matching checker. For the wider picture, read why PO matching fails in construction.