Purchases for stock are made in a very similar way to sales. Expenses, on the other hand, are created differently. Expenses are costs such as rent, overheads and so on; they do not relate to stock that will be sold at a later date. Expenses are covered in the accounting user guide.

Because Purchase Orders (POs) relate to stock that has a value (an asset), they must be matched to an invoice from the supplier so that Pearl knows the exact cost of everything you are selling.

The ideal flow for buying stock is as follows:

1. Create Purchase Order
2. Send PO to supplier
3. Receive stock into warehouse
4. Receive invoice and match to PO
5. Pay invoice

You may alternatively receive and pay the invoice before the stock arrives; this is allowed and would be done when a supplier requires pro-forma (up front) payment. It is essential to receive the stock into the warehouse using Pearl as soon as possible after the delivery arrives to keep everything up to date.

Demo: Create and receive a PO now using the following steps. We'll then allocate a supplier invoice to this purchase order, and then pay the supplier later from the accounting area.

1. Click Purchases->Create Order->Choose supplier to create a new PO (Purchase Order). Confirm the details, choose a department or project if required then confirm. You can also create a PO by finding the supplier with the contacts quick search box and clicking 'new order' in the menu section.
2. Click the 'add items' link. Add items to the PO just as for a sale. Each item you wish to add must have already been created on your Pearl database, but need not have been allocated to this supplier. Allocating products to suppliers just makes life easier. To show all products for this supplier, tick the box next to the search field [there may not be any, depending on what supplier you have chosen]
3. You can exit the Purchase Order, create a new product and return to the order to add it later if required.
4. Once you have added all the products you need, choose a delivery date (optional) and save the PO.
5. Click 'place order' to open a window that will allow you to send the PO to the supplier by email. You can edit the PO template to change its appearance (see the 'Documents and Marketing' section of this guide).
6. Tick your own email to get a copy of this PO (this will be your hardcopy in the event of a dispute) and submit the page. The order has now been placed and the delivery date will show on your calendar.
7. Click 'home' from the main menu to take you away from the PO.

 You have now completed creating and placing a Purchase Order.

1. Search for one of the items that you have just ordered using the products quick search box. This will show all information for the product
2. Hover over the blue 'on order' quantity to see that there are items due for delivery. You can open the Purchase Order from here as well if required.
3. Imagine the delivery has just arrived. Click Purchases->View Purchase Orders to show a list of current POs. Choose the order that relates to the delivery and click the edit icon.
4. For now we'll assume that everything you have ordered has arrived; click the 'receive stock' link and then click 'submit' to add the items to your stock.
5. Under the Product info tab you can now see the quantity of items received.
6. Search for the same item you searched for earlier, and you'll see that there are now items 'on hand' i.e. available to sell.

If you make a mistake when receiving items into stock from a PO and Pearl says you have received more than you actually have, you can make a correction by entering a negative value in the box when clicking 'receive stock'.

Each delivery of stock is matched with the PO it is linked with, and it's value is recorded using the invoice matched with the order. This allows Pearl to run an accurate first-in-first-out stock system (where the oldest items in stock are sold first), this also keeps your asset management and profit reports up to date all the time.

If for some reason a PO was not created and a delivery has arrived, you will need to create the PO immediately before receiving the items into stock.

Other (non stock) purchases: If a purchase does not relate to stock that will be sold in the future, you should not place a PO. When the supplier invoice is received, enter it directly into your accounts using Accounts -> Supplier -> Invoice (overheads).