Documentation/ Consolidation/ What consolidation is
What consolidation is and when you need it
A supplier delivers several times a month and invoices once. Consolidating means tying that invoice to the deliveries behind it and checking that the items, the quantities and the prices agree.
On this page
The purchase cycle
- You order goods from a supplier.
- The supplier delivers, with a delivery note recording what was delivered.
- At the end of the period they raise an invoice gathering those deliveries up.
- You pay that invoice.
Between step two and step four is the blind spot: nobody checks, line by line, that what was billed is what arrived. Consolidation closes it.
On accounts with consolidation with AI switched on, picking which delivery notes make up the invoice and matching their lines stops being manual work even when the supplier words the invoice differently from the delivery note.
What it catches
| Difference | How it shows |
|---|---|
| Billed for more than was delivered | Invoice lines with nothing on the delivery notes behind them. |
| Delivered more than was billed | Delivery notes still unconsolidated at the period end. |
| A price that is not the one agreed | The item and the quantity match, the amount does not. |
| A different quantity | The item matches, the units do not. |
| A delivery invoiced twice | A delivery note already consolidated turning up on another invoice. |
| An item you never ordered | A line with no delivery note behind it. |
No arithmetic check catches any of these: an invoice can agree with itself perfectly and still be wrong about what was delivered.
What it needs
- The delivery notes uploaded in their list, as well as the invoice in its own.
- Both from the same supplier.
- The delivery notes not already consolidated against another invoice.
This is the requirement that generates the most questions: if the delivery notes are not uploaded, there is no consolidation to be had. The screen will say there are no delivery notes available, and that is not a fault: they are simply not in the system.
Where you do it
Inside the invoice itself, on its delivery notes tab. It is not a separate screen: you consolidate while you are going over the invoice, with its data in front of you.
The figures it shows
| Figure | What it is |
|---|---|
| Invoice net | The net amount of the invoice you are looking at. |
| Consolidated (net) | The total of the delivery notes already tied to it. |
| Outstanding (net) | The difference between the two: what is left to cover. |
| Progress | How much of the invoice is covered. |
| Status | Pending, partial or complete. |
Outstanding is the number to watch: until it is zero, the invoice is not covered by deliveries.
When it is worth it and when it is not
| Situation | Worth it |
|---|---|
| Suppliers who deliver several times and invoice once | Very. This is what it exists for. |
| A lot of lines on each invoice | Very: checking by hand is not realistic. |
| Agreed prices worth keeping an eye on | Very. |
| A supplier who invoices every delivery separately | Not much: it is one to one and you can see it at a glance. |
| Expense invoices: utilities, services | Not at all: there is no delivery note. |
| Businesses that never get delivery notes | Not at all, unless they start uploading them. |