7 Kinds of Financial Forms for Business Transactions

A guide on the basic accounting forms & documents needed by any business

Paperwork. More paperwork. And even more paperwork. Who hasn’t been hassled by paper works?

In businesses, paperworks are necessary as it is an important tool for smooth business operations. Every single business requires paperworks especially budding entrepreneurs. Whether you like it or not, there is a need to properly document transactions, and ultimately do the paperwork.

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No matter the size of your business or what industry you are in or where you operate, you and every other business share the same duty–and that is documentation. Although, businesses differ in their process of documentation, the main purposes have remained the same: (1) to establish internal control for the benefit of the business; and (2) to provide evidence of all transactions of the business.

The scope and intricacy of documentation depends on the size and complexity of the business. The larger your business is, the wider the range of documentation needed. Different departments also require different forms and documents as evidence of its transactions. The most well-documented and corroborated department, however, has to be finance and accounting. Accounting and finance needs strict monitoring, control and substantiation.
This article will discuss the basic and most common financial and accounting forms and documents essential to a business.

Internal and External Documents

Documents and forms can either be for external, internal or both.
External documents and forms are those that are issued or given mainly to parties outside the business as proof of a transaction done with the company. Some of these are Official Receipts, Sales Invoice, Purchase Orders and Check or Cash Vouchers.

Internal documents on the other hand are those that are generated and maintained principally to establish internal control and monitoring. These documents are issued and circulated within departments and personnel as proof of transactions that have taken place inside the company and among the staff to trace responsibility. Some of these are the Purchase Requisition, Disbursement Forms and Liquidation Forms.

Purchase Requisition


A Purchase Requisition is an internal document filled out by any of the departments within the company of the items they want the purchasing department to buy for them. A PR is internally generated for internal purposes, thus the company decides on the format of the PR. Important details present in the PR include the date of requisition, items required, their description and quantity. A PR should also be approved by the duly allowed signatories. An approved purchase requisition leads to the generation of the Purchase Order.

Purchase Order


A Purchase Order is an external document made by the company, which is sent out to suppliers for a request to purchase goods or to provide a service. Companies vary in their format since there are no regulations requiring a standard layout. A basic PO must show the shipment address, items ordered, quantity ordered and total amount payable. In the part of the vendor, the corresponding document is called Sales Order (SO). Copies of PRs and POs are attached to another document called Receiving Report.

Receiving Report


A Receiving Report is another internal document made by the receiving department confirming the receipt of items or services acquired by the company. There is no required layout of RRs. It depends on the company what information they want to see in the RR. The most important details include the date received, in what condition received, who received them and to which warehouse they will be stored. Additional details include reference number of the PO, PR and Sales Invoice.

Check/Cash Voucher


A Check or Cash Voucher is an internal document proving the disbursement of funds from the company. It contains the journal entry made in the books recording the transaction. It has reference to the expense made and contains attachments like PO, RR and Sales Invoice. A check or cash voucher must be duly approved by the responsible officers of the company. The payee affixes his signature in the voucher to confirm receipt of the payment.

Delivery Receipt


A Delivery Receipt is an internal document produced by the company for deliveries of goods or services rendered by the company to its customers. The DR contains data like date delivered, items delivered, in what quantity, addressee and other references the company sees fit to reflect. When the goods are delivered or services have been rendered, the customer acknowledges acceptance in the DR. The company then uses the acknowledged DR as the basis to bill the customer through another document called Sales Invoice.

Sales Invoice


A Sales Invoice or Bill is an external document produced by the company and is sent out to its customers to bill them for service rendered or goods purchased. The SI contains information in reference to the services rendered or items delivered, the date they were delivered, the PO number made for the sales, the date when the payable is due, the payment terms and other conditions. Inquire with your state government agencies regarding the regulations of SIs. Tax regulatory bodies in some states require the official registration of SI to make them effective and binding. Some states further require the accreditation and registration of printing press and manufacturers who provide SI forms to companies. Invoice machines also have to be registered. Failure to register will result to levies and penalties. In other countries, Billing Statement is issued for goods delivered instead of SI and SI is issued only upon payment.

Official Receipt


An Official Receipt is another external document issued by the company to its customers evidencing the receipt of payment for services rendered or goods delivered. An OR contains the date payment is received, the SI or billing statement the payment pertains to, the payer, address of the payer, the federal registration of the payer, amount of federal taxes included and all other information the tax regulatory bodies of your state require. Among the documents in the accounting records, the OR is the most regulated of all. The company cannot produce their own OR forms unless registered with the tax bureau. There is also an expiry date as to the effectivity of blank OR forms. In some countries, ORs are only issued for receipt of payment for services rendered while SI are issued for receipt of payment for goods delivered. It is best to consult with your concerned government agencies before issuing or producing your OR forms.

Have a filing system for auditing and documentation purposes

All of these forms are accounted for through a numbered sequence. These forms are supplied in duplicates and sometimes, in triplicates to furnish a copy to every party involved. These documents are very essential during audits, queries, tracking of transactions and all other events the company may deem necessary. That is why it is very important to devise a good filing system of these records. If you are a budding entrepreneur, include in your to-do list the implementation of an efficient and effective documentation system.

Today people are lucky enough to have other options other than the conventional way of producing these documents. They may be paperwork, but they don’t necessarily have to be on paper. Now, there are digital documents, database systems, and online forms. Nothing beats hard copies but you can make use of the free templates on the internet for your documentary needs. As long as the formats provide you with the information your business needs, feel free to use the best one you can find.

CPA / Corporate Accountant
Agusan Plantations Inc.
Grabbed her CPA license at 19. A full-time accountant. A part-time bohemian. Doesn’t believe in the existence of free time. Sings in the shower. Dances in her room. Reads a lot but forgets them. If it doesn’t balance, then the figures must be wrong.

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