Procure to Pay process (also known as P2P cycle) is followed by any organization in any ERP system if they would like to purchase any products (Goods, raw materials, Services, office supplies, infrastructure, etc). When you purchase any product there should be a payment towards the purchase. This entire process of purchasing a product and making payment for that product to supplier is called procure to pay process.
In brief in P2P life cycle an organization buys and receives goods or services from its vendor and makes corresponding payments.
Below are the steps involved in this process:
- Create a Purchase Requisition
- Approve the Purchase Requisition
- Auto create a Purchase Order from Requisition
- Approve the Purchase Order
- Receive the goods in Inventory (Create the Receipt)
- Inspect the goods
- Create a Payables Invoice
- Pay the Invoice
- Transfer to General Ledger
- Import Journal in to General Ledger
