Go back

What is the basic difference between Spend Money (Banking Command Centre) and Pay Bills (Purchases Command Centre)? Every time I think I’ve got it, it doesn’t work.

Good Question!   This is one that many people get confused with so don’t beat yourself up! The "Enter Purchases” function allows us to account for any invoices that are unpaid for any length of time. Usually this is when a supplier has allowed us credit terms, so we will pay the bill at a later date. We enter the purchase to update our P&L, and we can also then get a list of accounts payable showing those outstanding bills. When we pay them, often not until the 20 th of the following month, we then use “Pay Bills” to allocate our payment against the outstanding purchase.

The "Spend Money" function is for anything that is bought and paid at the same time. There is no timing difference between the expense being incurred and the payment of the expense, so there is no need for us to record that bill under purchases because it is not outstanding.

"Spend Money" is also used for other outward payments where we don’t have a supplier invoice, ie:

• wages
• tax payments
• hire purchase/loan repayments
• automatic payments for rent, insurances…..
• etc

Go back