II. Functioning of accounts
Class 4.  Accounts receivable and payable

40. Suppliers -
Accounts payable and related accounts


Account 40 " Suppliers - Accounts payable and related accounts " records debts and advances payments related to the purchase of goods or services.

Account 401 " Suppliers " is credited with the amount of invoices for the purchase of goods or services by debiting:

  • the relevant accounts of Class 6 for the amount excluding taxes recoverable by the entity;

  • Account 4096 " Suppliers - Receivables for returnable packaging and equipment " ;

  • Account 4456 " Deductible taxes on turnover " for the amount of taxes recoverable by the entity.

Account 401 is debited by crediting:

  • A cash account for payments made by the entity to its suppliers;

  • An account of Class 6 for the amount of credit notes received when goods are sent back to the supplier;

  • Account 403 " Suppliers - Bills payable " when a bill of exchange is accepted or a promissory note is issued;

  • Account 609 " Allowances, discounts, rebates received on purchases " for the amount of discounts, rebates and refunds received without invoices;

  • Account 409 " Suppliers with a debit balance " for the amount of advances and deposits paid on orders, for the balance of the account.

When fixed assets are acquired, account 404 " Fixed assets suppliers " is credited by debiting:

Account 404 " Fixed assets suppliers " is debited by crediting, in particular:

  • a cash account when the entity makes payments to its suppliers;

  • the account 405 " Fixed assets suppliers - Bills payable " when a bill of exchange is accepted or a promissory note is issued.

At the end of the accounting period, account 408 " Suppliers - Invoices not yet received " is credited with the amount, including taxes, of the invoices relating to the ended period but not yet received, the amount of which is known and can be estimated, by debiting the relevant accounts of Classes 4 and 6. At the beginning of the next period, these postings are reversed. Entities may also debit account 408 directly by crediting account 401 on receipt of the invoice, with the appropriate adjustments being recorded in the relevant accounts.

Account 4091 " Suppliers - Advance payments on account on orders " is credited by debiting account 401 and if necessary account 404 after receiving of the invoice by the entity. It is debited, when the entity pays advances on orders to suppliers, by crediting a cash account. Advances paid on orders for fixed assets recorded during the financial year in account 4091 are transferred at the end of the financial year to accounts 237 or 238.

Account 4096 " Suppliers - Receivables for returnable packaging and equipment " is debited by crediting account 401 when suppliers consign packaging or equipment to the entity for the amount of the consignment.

It is credited:

  • by debiting account 401 when the entity returns the packaging or equipment at the consignment price;

  • by debiting account 602 " Inventory Purchases - Other Supplies " when the entity decides to keep the consigned packaging or equipment;

  • by debiting account 401 and the subdivision of account 613 entitled " Packaging Wastage " if the return is for an amount less than the consignment price.

Debit balances of accounts payable to operating and fixed asset suppliers other than 4091, 4096 and 4098 are transferred to the debit of account 4097 " Suppliers - Other debit balance payables " .


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