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I have worked with few packages in different firms and none of them had this issue. Every bill processed goes into P&L regardless of being approved or not.
I am surprised Xero has not fixed this issue yet. Worth looking at other packages like Myob or Greentree.

Hi @xero - have you put anymore thought into how invoices 'awaiting approval' can be accounted for more appropriately? It rears it's head all the time, our dashboards are never a true reflection, we can use the xero cash flow forecasting effectively and I'm sure there are other areas that it effects.

Wondering if we could perhaps arrange a time with someone from your products team to chat over the challenge and see if there is a better way this can be dealt with?

Agree whole heartedly - this would help HUGELY

I would understand if it was for PO, they don't need to posted to P&L directly, they should be Journaled as a reversing accrual. But the Awaiting Approval should be in P&L but not shown on your payment run.

Hi There,

I've come across another issue with this. I need to be making some claims for work we have done during the month, of which I have been checking a custom report against the specific jobs. It has now become apparent that while an invoice is awaiting approval, it does not show in these reports.

Then trying to find the invoices in the awaiting approval section is like trying to find a needle in a haystack as there is no job codes / references in this view (that I can find). I'm very likely missing claiming everything we're entitled to be claiming... Help?

Good Morning - Just checking in on this one again, as again it is proving to provide inaccurate reporting for our business.

@xero - what advice do you have for us on how we can best manage this situation until (hopefully!) you make some upgrades to the program so it accounts for these liabilities correctly.

To properly and accurately reflect the liability to a company, the 'awaiting approvals' invoices should absolutely be included in the P&L, etc.

Agree with comments made, awaiting approval is a direct liability to the company and therefore should be reflected in the P an L, BS etc.

This really is an important issue in my opinion.

Appreciate that different businesses have different levels of bills that actually end up getting approved, but I would think the very vast majority of businesses P&L would be more accurate if the "awaiting approvals" were accounted for.

We can't rely on the cash flow forecasting, and all of these extra tools are rubbish without having the awaiting approval invoices accounted for correctly as the liability they are.

As simple switch that the user can decide on how they are accounted could / would be an easy solution?

This tends to make reporting inaccurate and not a true reflection so it would be good if we could include bills awaiting approval

It is disappointing to hear that response Xero as 'prudence' is one of the fundamental principles in accounting to recognise costs when they are identified.

In addition to the Xero method not recognising costs as they arise, it is also not possible to reconcile supplier statements as the report of outstanding transactions for a supplier has no facility to include those awaiting approval.
To achieve this in Xero will require some clunky work around to either accrue for outstanding invoices awaiting approval, or to mark them as approved, but to flag them in some other way so they don't get included in payment runs.

We are only just switching to Xero from an alternative desktop based package which treats invoices on hold in the correct manner, and we will need to start looking elsewhere if this situation is not going to be resolved by Xero.

The importance of this needs escalating in some way to address this failing.

This should be included.

Profit & Loss reports do not include entered bills that are not yet approved. This means it is not a true reflection of costs for the month