Explain P2P cycle

Question

Explain P2P cycle

Accepted Answer

P2P cycle stands for Procure to Pay cycle, which is the process of obtaining goods or services from a supplier to making payment for them.

P2P cycle starts with identifying the need for a product or service and creating a purchase requisition.
Next step is to create a purchase order and send it to the supplier.
Upon receiving the goods or services, the receiving department inspects and confirms receipt.
An invoice is then generated by the supplier and sent to the buyer for payment.
Finally, the buyer processes the invoice for payment and completes the transaction.
Example: A company needs to purchase office supplies, so they create a purchase requisition, issue a purchase order, receive the supplies, process the invoice, and make the payment.

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