Define Goods Received Note: Everything You Need to Know
To define goods received note, it is helpful to understand the buying and selling records process.3 min read
To define goods received note, it is helpful to understand the buying and selling records process. When a seller sells an item to a customer, they should keep some type of record of the sale. The goods received note finalizes the sale and acts as proof that the products were actually received. This document is then compared to the purchase order.
In the case of goods received notes, the customer is often the buyer. The seller is the supplier. This note is kept on record by all parties involved to provide physical documentation that the goods made it to the buyer. This document may also be used in the accounting department to verify the invoice with the items received.
Important Information on the Goods Received Note
The goods received note includes important information about the order including:
- Each item ordered
- The cost of each item ordered
- The number of items ordered
- The number of items received
When a buyer places a large order with a supplier, they receive an order form. The supplier can then compare the order form with the goods received note to ensure that all items actually made it to the buyer. This form can also be helpful when an order includes items that are back ordered or no longer in stock. The use of the goods received note can reduce errors in the transaction process.
The goods received note can also be used to solve disputes later on. The buyer and the supplier are not the only parties to touch the order. A delivery person is also involved in the transaction. If a dispute arises, the goods received note can identify who is responsible for the problem.
Some businesses, especially larger ones, rely on the goods received note. They automatically generate one with every order received. The final invoice is only paid if, and when, the goods received note, the purchase order, and the invoice all match up.
Goods Dispatch Note
The goods dispatch note is the supplier's records of the same order. It is created every time an order is delivered or shipped. One copy is given to the dispatching department and another to the accounting department. The accounting department uses this document to create an invoice. They are numbered in order to keep track of the entire process.
Goods Delivery Note
In comparison to the goods dispatch note, the goods delivery note goes with the order sent to the buyer and lists the actual items delivered. If the buyer signs the goods delivery note, they are accepting that all the included items in the order were actually delivered. The goods dispatch note authorizes the items dispatched whereas the goods delivery note authorizes the items that slated for delivery.
This process ensures that there is a paper record of all steps the goods go through. If there are any disputes later on, both the buyer and the seller can go back to their records to compare documents. By doing this, they can usually identify the cause of the problem and then seek reimbursement from that party.
In summary, these documents are important to the buying and selling of goods process:
- Goods dispatch note: This note is a record of the goods that were actually dispatched. This note goes to the seller's accounting department to process an invoice for the buyer.
- Goods delivery note: This note acts as the documented proof for the actual goods delivered. The party that accepts the delivery will check the order and sign off on the delivery. If there are any disputes, they will not sign the delivery note.
- Goods received note: This note is the record of all items actually received. This often occurs after the buyer has completely unboxed and gone through the items. The goods received note is then sent to the buyer's accounting department and compared to the other documents. Payment of the invoice happens if everything matches up.
It is important to include each of these documents in the buying and selling process. It protects all parties and makes it easier to identify any problems. Otherwise, one party could end up losing out financially for a problem that they are not responsible for.
If you need help with the goods received note, you can post your legal need on UpCounsel's marketplace. UpCounsel accepts only the top 5 percent of lawyers to its site. Lawyers on UpCounsel come from law schools such as Harvard Law and Yale Law and average 14 years of legal experience, including work with or on behalf of companies like Google, Menlo Ventures, and Airbnb.