Explaining to Nedbank what a PROFORMA INVOICE is...

LazyLion

LazyLion

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So the client in Zimbabwe orders our product.
We send him a PROFORMA INVOICE.
He pays on proforma invoice, nedbank receives the US Dollars.
Nedbank e-mails us asking for the Invoice.
So I send them the Final Invoice.
Nedbank emails us back and says the Invoice doesn't match the reference.
So I send them a copy of the proforma invoice.
Nedbank emails us back and says they cannot pay out on two different invoices.
I tell them it's not two different invoices, It's a proforma invoice and final invoice.
They email back and ask which invoice they must use.

Frustration.gif
 
Bank staff are completely incompetent these days.

Had an interaction with FNB recently that you just wouldn't believe.

Bank management seems to expect clients to educate their staff.
 
Try explaining anything to Nedbank, they are fcking retards, I am not sure why the hell my business account is still with them
 
Jola said:
Bank staff are completely incompetent these days.

Had an interaction with FNB recently that you just wouldn't believe.

Bank management seems to expect clients to educate their staff.
Click to expand...

Wow I am still facepalming after my interaction with FNB about sending money from my SA account to my Norwegian account. They just could not fathom the concept that a person could have 2 different accounts and that I wasn't in SA to come into the bank or to get a physical letter from sars.
 
Voicy said:
Wow I am still facepalming after my interaction with FNB about sending money from my SA account to my Norwegian account. They just could not fathom the concept that a person could have 2 different accounts and that I wasn't in SA to come into the bank or to get a physical letter from sars.
Click to expand...

May be related to Exchange Control issues.
 
midnightcaller said:
What the difference between a
Quotation
Pro forma invoice
Final invoice
Click to expand...

You can issue a pro forma invoice and expect payment. Once payment is made you issue an invoice. Once you've issued an invoice you are liable to pay VAT to SARS. So for cash flow reasons it makes sense to do it in two parts as the customer could still cancel an order or not pay.

Note: I am not an accountant ;)
 
biometrics said:
You can issue a pro forma invoice and expect payment. Once payment is made you issue an invoice. Once you've issued an invoice you are liable to pay VAT to SARS. So for cash flow reasons it makes sense to do it in two parts as the customer could still cancel an order or not pay.

Note: I am not an accountant ;)
Click to expand...
No its got nothing to do with payment. Payment goes with the receipt document & may happen months after the sale & invoice. Usually its the other way round as well. Invoice gets issued to the customer & payment is based on that (usually the bank details are on the invoice anyway).

Quotations generally deal with the price & contain limited other info. They usually written in a way that they're not legally binding, but most sellers will honour it anyway.

Proforma invoices generally serve as confirmation of what the final invoice will look like (i.e. might include details on shipping / updated forex rates etc). Looks identical to the real invoice except says Pro forma on top & doesn't count as a valid VAT invoice. Again not binding, but generally honoured. These are issued *before* the transaction has legally occurred. I gather they're used in for import export businesses as you need to submit an invoice to clear the goods but the transaction hasn't occurred yet (thus no invoice yet).

I'm a little wary of pro-forma invoices tbh. There is way to much potential for sorcery there...its fine...as long as you get a proper invoice as well.
 
This is a good explanation although these days you are seeing quotes and Proformas being used interchangeable.
I like what Havoc says though, it's the way I like to handle them.
Quotes can chop and change quite quickly until the customer is happy with the price and quantity.
The issue a Proforma.
When goods are handed over then the Invoice is given to customer.
 
In my view you call up a seller and ask how much "x" will be, they send you a quote, it is then expected(although not binding) that they will keep that price for a set amount of time. Once the buyer is happy with the quote he says ok sure I'll take "x", seller then sends a proforma invoice, it is now expected that the client pays this amount. Once payed an invoice is issued that is a proof of payment and that "x" must be delivered and used for tax etc etc.

Although since quotes and proforma invoices are not legally binding you can skip either or both.
 
LazyLion said:
This is a good explanation although these days you are seeing quotes and Proformas being used interchangeable.
Click to expand...
I suspect that legally they'd be treated the same, so essentially they are.

LazyLion said:
When goods are handed over then the Invoice is given to customer.
Click to expand...
Technically you'd do delivery notes at that stage. Customer signs one (thus you can prove you delivered your end of the bargain) and customer keeps the carbon copy. Frequently the invoice & Deliver note is one & the same thing though. i.e. Says Tax invoice but has a field on it that the customer signs as confirmation of receipt.

Its all rather dynamic though - if you think of buying a pizza...its technically going through the entire sequence but they skip most of the documents.

As a bare minimum the customer would want a tax invoice and receipt, while the supplier would want a binding purchase order (i.e. with signature) and a signed deliver note of goods / confirmation of services being completed. But again...places like a pizza joint skip their part because its not worth it making the customer sign a purchase order for a margherita pizza.

oh and while were on this topic - a more general request...anyone issuing invoice...please go read on the SARS website what you need on there to make it a legal VAT invoice. The amount of crap people issue as invoices is astounding.
 
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This is the way I normally do transactions:

Request quote for services or goods. Quote has T and C associated. Can be considered binding.
Acceptance of quote - I sign and send back.
Issue purchase order to supplier.

When services are delivered or goods received, there is a good/services received note or delivery acceptance. This must match quote fully or partially. I sign.

Supplier then raises tax invoice which must match G/SRN.

Payment is made to seller with remittance advice.

Statement of account is normally sent once a month.

The above might be right or wrong. I dunno.

Edit:
Never used pro forma invoice. I was given a few. I told the supplier to change it to a quotation.
 
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