Purchase Orders - Posting to General Ledger + Xero Projects Integration
The functionality to be able to raise and approve a Purchase Order which, at the point of approval, would create a double entry in the general ledger. Specifically:
• Debit a Work in Progress (WIP) expenses account (to reflect anticipated expenditure),
• Credit a creditors account (to reflect the anticipated liability).
This would allow the PO to reflect a commitment in the accounts, enabling better management of Work In Progress and projected costs before the supplier invoice arrives.
In an ideal world, to be able to allocate the PO to a Xero Project, so that WIP and anticipated costs appear within the project reporting as well. This would give far more accurate forecasting and project-level financial visibility.
As it stands, it is understood that Xero POs are non-posting documents and only affect the ledger once a bill is created and approved. That leaves a visibility and accounting gap for committed costs — especially problematic for longer-term projects or cashflow planning.
Tristan Wheadon
shared this idea
Hi Tristan, thanks for sharing such a detailed and well-thought-out suggestion. We appreciate you taking the time to explain the specific accounting impact and how this would improve financial visibility.
We've reviewed your idea for having approved Purchase Orders post to the general ledger and integrate with Xero Projects. This suggestion is now ready to gain support and feedback from other community members.
Along with votes, others can now comment on how having this visibility of committed costs could improve their own project management and financial forecasting in Xero. 🙂
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Vicki Manning
commented
Introducing this functionality would be a game-changer for our business operations. The ability to post Purchase Orders directly to the general ledger—creating a double entry at the point of approval—would significantly enhance our financial visibility and control.
By recording anticipated expenditure (WIP) and associated liabilities early, we can better manage project budgets, improve cash flow forecasting, and reduce surprises later in the accounting cycle. This kind of commitment accounting is especially valuable for longer-term or high-value projects, where the time between PO approval and invoice receipt can be substantial.
Even more impactful is the integration with Xero Projects. Being able to allocate POs to specific projects means our project-level reporting becomes far more accurate and insightful. We’d have a clearer picture of expected costs at every stage, enabling more strategic decision-making, proactive cost control, and ultimately more profitable project delivery.
This improvement would close a critical gap in our current financial workflow and elevate our project accounting to a much more robust and future-ready standard.