At what point are supplier invoices created in relation to the receipt approval?

The correct answer indicates that supplier invoices are created after the approval of a receipt. This process is important because it ensures that the goods or services received are verified before a payment is initiated. By waiting for receipt approval, the organization can confirm that what was delivered matches what was ordered, thereby reducing the possibility of errors and disputes related to invoicing.

Approval of a receipt involves checking the items against a purchase order to ensure that quantities, quality, and specifications align with the expectations. Once this verification is completed and approved, it signifies that the organization is satisfied with the delivery and can then create the supplier invoice accordingly. This sequencing helps maintain accuracy in financial records and safeguards against potential overpayments or fraud.

In scenarios where invoices might be created before receipt approval, there is a higher risk of processing payments for goods or services that were not correctly received or do not meet contractual terms. Such practices can lead to discrepancies and financial losses, thus highlighting the importance of receipt approval as a prerequisite for invoice creation.