Golden rules of accounts and P2P cycle

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The golden rules of accounts and the P2P cycle are essential principles for effective financial management and procurement operations.

The golden rules of accounts refer to the fundamental principles of accounting that ensure accuracy and reliability of financial information.
The P2P (Procure-to-Pay) cycle is the process of acquiring goods or services, from the initial procurement request to the final payment.
Some golden rules of accounts include the principles of debit and credit, which ensure that every transaction has equal debits and credits.
Another golden rule is the principle of consistency, which requires consistent accounting methods and practices to ensure comparability of financial statements.
In the P2P cycle, key steps include requisitioning, sourcing, purchasing, receiving, invoicing, and payment.
For example, in the requisitioning stage, a procurement operations associate may receive a request for a specific item or service from an internal department.
During the sourcing stage, the associate may identify potential suppliers, negotiate contracts, and select the most suitable vendor.
Once the purchase is made, the receiving stage involves verifying the quantity and quality of the goods or services received.
Invoicing involves receiving and reviewing invoices from suppliers, ensuring accuracy and resolving any discrepancies.
Finally, the payment stage includes processing payments to suppliers, ensuring timely and accurate disbursement.
Effective adherence to the golden rules of accounts and the P2P cycle helps maintain financial integrity, control costs, and optimize procurement processes.

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