Internal Audit
Authoritative Source
Goods Received Note (GRN)
Receiving document confirming physical receipt and inspection of ordered goods.
Detailed Definition & Procurement Context
Goods Received Note (GRN) is governed by Internal Audit standards across supply chain operations, accounts payable sub-ledgers, and working capital optimization. Rigorous tracking of Goods Received Note (GRN) prevents stockouts, reduces carrying holding costs, and improves procurement internal controls.
Mathematical Standard & Equation
GRN Value = Quantity Accepted × Unit Purchase Order Price
General Ledger / Procurement Journal Entry Standard
Debit: Inventory Asset / Goods Received Accrual
Credit: Accounts Payable Liability / Cash
Credit: Accounts Payable Liability / Cash
Common Operational Pitfalls
- Failing to incorporate lead-time variability into safety stock buffer calculations.
- Relying on manual invoice processing rather than automated three-way matching workflows.
- Forfeiting 2/10 Net 30 vendor early payment discounts due to approval bottlenecks.