What is the process of the procure-to-pay (P2P) cycle?

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Accepted Answer

The procure-to-pay (P2P) cycle is the process of obtaining goods or services from a supplier and paying for them.

1. Requisition: The process starts with creating a purchase requisition for the required goods or services.
2. Purchase Order: Once the requisition is approved, a purchase order is created and sent to the supplier.
3. Goods Receipt: Upon receiving the goods or services, a goods receipt is recorded in the system to confirm delivery.
4. Invoice Verification: The supplier sends an invoice, which is matched with the purchase order and goods receipt for payment.
5. Payment: Finally, the payment is made to the supplier based on the agreed terms.
6. Integration with financial accounting: The P2P cycle is integrated with financial accounting to ensure accurate recording of transactions.

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