Understanding Commercial Documents in Accounting
Commercial Documents
Accounting transactions reflect changes experienced by the assets of a business. These variations cannot be arbitrary, but must be based on documents supporting each transaction. These are called commercial documents.
Companies receive documentation from those persons or entities with which they do business. These vouchers are called external documents.
When the company issues such documentation, these are referred to as internal documents.
The main documents that relate to accounting are detailed below.
Invoice
It is the document that expresses and proves a purchase and sale of goods or services.
Types of taxpayers related to invoices:
- Responsible Registered (Responsable Inscripto): Is authorized to charge VAT on its sales invoices, separating this amount depending on the case. They must file affidavits and deliver the amount collected monthly to the AFIP.
- Responsible Exempt (Responsable Exento): Would have been in the category above, but is expressly exempted by law.
- Non-Taxable (No Responsable): Is a person who engages in an activity not reached by the tax.
- Monotributo: It is a special category created by the Monotributo law. They may not charge VAT.
- End User (Consumidor Final): A person on whom the entire tax burden rests.
We have in our possession the original when we make a purchase. In case we have the duplicate, it represents a sale.
The Single Tax Identification Code (CUIT)
It is a unique and non-transferable number by which each person can be identified for the purposes of tax and pension status, which is issued by AFIP.
The large number of operations performed in many businesses has imposed another way of documenting sales, given the inconvenience caused by the issuance of an invoice for each operation and the time that this demands. Hence, the Ticket has been implemented as proof for such operations.
The main data contained in a ticket are similar to those of an invoice, but it is typically used for smaller transactions.
Delivery Note (Remito)
It is the document accompanying the goods for the purpose of confirming the actual delivery of them.
This document allows the buyer to check that the goods received are those requested and purchased. The seller can confirm that the buyer received the merchandise, and their compliance with the order.
Debit Note
It is the document evidencing an increase in the amount payable by the buyer, or a charge made to them.
It arises from a transaction between buyer and seller, related to an invoice, and indicates that a specific reason must be charged to the customer’s account, creating a new amount owed.
Credit Note
It is the document evidencing a reduction in the amount payable by the buyer, or a credit that is made to them.
The reasons include: buyer returns, billing errors (overcharges), discounts on invoiced amounts, etc.
Receipt
The document in which a person certifies that they have received, on a certain date, a sum of money or other securities (checks, promissory notes, etc.) for a specified reason.
Promissory Note
The document by which a party promises to pay a sum of money to a specific person, upon the expiration of a deadline detailed in that promise.
Cheque
It is defined as an unconditional payment order issued against a bank where the drawer has funds deposited in their checking account or authorization to overdraw.