Delivery note meaning
The delivery note is a shipping document that enlists details of delivery. It’s generally used to certify/verify receipt of the goods by the warehouse manager/buyer. Once delivery note is signed by the warehouse manager, it’s an acknowledgment that the goods have been received by the buyer.
Example
You have received a delivery from Agha stores. The delivery staff hands over the goods to your warehouse manager. Along with goods, there is a note that enlists all delivery items. The warehouse manager is supposed to reconcile physical delivery with a note. Once delivery is reconciled, the warehouse manager signs a note to certify that they have received the goods mentioned in the note. This note is called a delivery note.
In this article, we have discussed the following aspects of the delivery note.
- Uses of the delivery note
- Content of delivery note
- Delivery note vs. invoice
- How to create a delivery note
Uses of the delivery note
Following are some of the uses of the delivery note.
- Provides a strong base to record sales – As per the realization concept of accounting, revenue should be recorded when delivery is made to the customer. And the best document to prove delivery is delivery note.
- Proof of delivery – The delivery note is signed by warehouse manager of the customer. The delivery staff is responsible to obtain the signature of the warehouse manager after satisfying them about goods delivery. Hence, the delivery note is strong proof of the delivery.
- Help in invoice preparation – The invoice contains two important elements. These elements include quantity and amount. The source document to verify the quantity is the delivery note because it contains the signature of the buyer’s warehouse manager. Hence, a delivery note is an important element in the preparation of the invoice.
- The source document for record keeping – This note is important for both customers’ and sellers’ records. For the seller, delivery note helps to trace delivery and they can reconcile inventory records. Similarly, customers can use this note to update their warehouse/inventory records.
- Protection for the seller – If the warehouse manager of the buyer signs the delivery note. It’s a confirmation from the buyer that they have received the goods from the seller in a good condition. Hence, once a note is signed, it acts to provide confirmation to the seller that they have fulfilled their duty in a reasonable manner.
- Delivery note at the time of payment – A delivery note at the time of payment helps to prove that goods have been received and there is a need to pay.
Content of delivery note
The following are essential content of the delivery note.
- Listing of products being delivered– It should contain comprehensive details of the delivery including quality specification, quantity, and other related details.
- Signature of the customer’s warehouse manager – The delivery note is incomplete without the signatures of the warehouse manager. It’s a receiving from the buyer that they have received the goods. Even, it’s a good idea to have a stamp of the customer along with signatures.
- Time and date of delivery – It’s necessary to have the time and date of delivery. It helps to avoid any grievances in the future. Even, if there is some grievance in the future, things can be tracked and problems can be solved.
- Address of supplier and the buyer – It helps to locate the movement of the goods from seller to buyer.
- Delivery number– It’s a sequential number that helps in tracing the documents.
- Contact details – Different streams of contact details should be given on delivery note.
Further, it should be noted that the delivery note is different from the invoice. Let’s discuss how it’s different.
Delivery note vs. invoice
Following are some of the differences between delivery note and invoice.
| Delivery note | Invoice |
| It’s a receiving of the goods delivered to the customers. | It’s a request for payment. |
| It’s prepared before the invoice. In other words, an invoice is prepared once a delivery note is final. | It’s prepared after the delivery note. In other words, goods are dispatched, receiving is obtained from a buyer and then invoice is prepared on the basis of a delivery note |
| The signature of the buyer’s warehouse manager is required for an effective delivery note. | The signature of the buyer is not required on the invoice. |
| It can be used in place of an invoice if the buyer wants to keep an anonymous supplier. | The invoice can be replaced by a delivery note. However, subject to some agreement between the supplier and buyer. Further, it’s not a good practice to replace the invoice in place of the delivery note. |
Conclusion
The delivery note is a shipping document. It’s used to verify delivery made by a supplier to the buyer. It’s used as a basis for the creation of invoice/bills. It’s one of the most important source documents and essential for warehouse maintenance.
There are different uses of the delivery note that include but are not limited to helping in invoice preparation, acting as proof of the delivery, protecting the seller, and acting as a source document for record keeping.
Frequently asked questions
Can we use a delivery note instead of an invoice?
Yes, a delivery note can be used as an invoice. Generally, a delivery note is used as an invoice in the following circumstances.
- The buyer does not want to disclose the identity of the supplier.
- The buyer does not wish to document how much they have paid for the purchased product.
How to create a delivery note?
The following details are required for the creation of a delivery note.
- Details for the name and address of the buyer/supplier.
- Delivery note number/sequential number.
- Details for the shipment time, date, and mode of delivery.
- Description and details for the quantity/quality of goods delivered.
Once all of these details are ready, these need to be pasted into a single document. When delivery staff makes a delivery to the customer, they need to have the signature of the buyer’s warehouse manager. Once, the buyer has signed the note, it’s effective.
Is the delivery note the same as the goods receiving note?
Technically, there is no difference between a delivery note and goods receiving the note. It can be the same document. However, the goods receiving note is more relevant from the perspective of the customer, and the delivery note is more relevant from the perspective of a supplier.
