An invoice is a kind of straightforward statement with the details of the sale to buyers and sellers. However, many companies deal with different types of proforma invoices. A Proforma invoice is like a preliminary sale of invoices coming before the advance of delivery issued to both buyers and sellers. It includes the terms of sale containing the product descriptions, prices, terms of delivery, expiration date, etc. It gives a cost estimate of sales and not the final sale which can be subject to change.
Invoice Office is a great website for making proforma invoices. It sells in packages requiring your business at affordable rates. Proforma invoice is used by sellers when the main bill is not yet made and the customers are in need of an advance bill. A proforma invoice is not limited just to the import of goods. A seller can make this invoice at the demand of buyers anytime.
What information must be there on the invoice?
These types of invoices must contain the following information:
- Detailed product descriptions of the country to where the goods are imported and the country from which the goods are exported. They must use the 6-digit harmonized system or the Schedule B number for determining the taxes and duties.
- The prices of the products
- The delivery location, delivery item, and any such delivery terms as mentioned.
- The expiry date of the proforma invoice
An invoice is considered to be a non-negotiable instrument by the Invoice office containing certain specific details like the price, details of products, details of goods delivered, contact details both of sellers and buyers, total due, etc.
The difference between purchase order and proforma invoice
A proforma invoice is considered to be the same as a purchase order with both wanting the same type of details. The only difference is the origin, the seller can be seen preparing and sending the invoice to the buyer. But in the case of the purchase order, it is the buyer who makes the order and then sends it to the seller for using the document for matching with the disbursing.
A purchase order is an official document which also means an official confirmation of the sale. Proforma is a quote of sale and it is not the confirmation. That is why proforma invoices can change before the actual sale price is decided.
Some best practices for handling proforma invoices
Since it is a quote, the prices are subject to change. This is the reason that accounting doesn’t record a proforma invoice. But buyers can do the best while handing such invoices:
- Though it is subjected to change, this invoice gives almost the same sale price with little difference at times.
- When dealing with export services, the invoice must contain information transferable to other forms for creating forms like commercial invoices.
- Note the date of the proforma invoice. Some items like material costs, currency rates, etc. tend to rise and fall all depending on the market.
So, next time you plan on making proforma invoices, you can take the help of the Invoice Office. They are the best when it comes to accuracy.
