{"id":46166,"date":"2022-03-09T09:57:59","date_gmt":"2022-03-09T09:57:59","guid":{"rendered":"https:\/\/softco.com\/glossary\/grni\/"},"modified":"2025-04-22T14:39:13","modified_gmt":"2025-04-22T13:39:13","slug":"grni","status":"publish","type":"glossary","link":"https:\/\/softco.com\/uk\/glossary\/grni\/","title":{"rendered":"GRNI"},"content":{"rendered":"\n
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What is Goods Received Not Invoiced (GRNI)<\/h1>\n<\/div><\/div>\n\n\n\n
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During the ordinary course of business, companies often receive goods that they\u2019ve purchased before the supplier sends an invoice. For businesses that use a perpetual inventory recording system, the goods are deemed as received, and as such, must be recorded in the company\u2019s inventory. <\/p>\n\n\n\n

Because the goods are received before the invoice from  the supplier, the accounts payable are not updated. As such, a GRNI account is maintained. The GRNI account helps businesses manage current liabilities for which a corresponding invoice has not yet been generated. <\/p>\n\n\n\n

What is GRNI in Accounts Payable? <\/h2>\n\n\n\n

Good Received Not Invoice (GRNI) is simply a record in the accounting system which shows that a certain amount of goods received have no corresponding invoice, though they\u2019ve probably matched to a corresponding purchase order.<\/strong><\/p>\n\n\n\n

A GRNI is an adjustment (contra) account and is shown as a current liability on the company\u2019s balance sheet. Businesses that use a periodic inventory system do not record goods as received until an invoice is received or the accounting period ends, so they don\u2019t need a GRNI account.<\/p>\n\n\n\n

Example of GRNI<\/h3>\n\n\n\n

To better understand the GRNI account, here\u2019s an example:<\/p>\n\n\n\n

Company X<\/strong> uses a perpetual inventory system, and purchases goods worth $2,000 from Company Y. <\/p>\n\n\n\n

The goods arrive before the invoice from Company Y<\/strong>. <\/p>\n\n\n\n

To reflect goods receipt in the general ledger, the following entry will be made:<\/p>\n\n\n\n

DEBIT CREDIT<\/strong><\/p>\n\n\n\n

Inventory $2,000<\/strong><\/p>\n\n\n\n

GRNI $2,000<\/strong><\/p>\n\n\n\n

Since an invoice hasn\u2019t been received, it\u2019s important to create a liability and credit the GRNI account instead of accounts payable. Inventory is debited to reflect the goods received. <\/p>\n\n\n\n

Once the supplier\u2019s invoice is received by the business, the liability is transferred from the GRNI to the accounts payable. The general ledger is updated with another entry, as shown below:<\/p>\n\n\n\n

DEBIT CREDIT<\/strong><\/p>\n\n\n\n

GRNI $2,000<\/strong><\/p>\n\n\n\n

Accounts Payable $2,000<\/strong><\/p>\n\n\n\n

This brings the GRNI account to zero and increases the accounts payable, accurately reflecting the payment to be made for the goods received. GRNI reconciliation is often error-prone, which is why most businesses rely on automated, cloud-based procurement software. <\/p>\n\n\n\n

Simplify GRNI With AP Automation Software<\/h2>\n\n\n\n

Leveraging artificial intelligence, procurement software <\/a>is able to generate accurate GRNI reports on time, eliminating human error, saving time and expenditure. In most transactions, the invoice is to arrive before a 3-way match is complete, so most transactions do appear on the GRNI every now and then. <\/p>\n\n\n\n

If an invoice has not been received for several months even after goods were received, it could indicate an issue. A high GRNI also indicates issues with the procure-to-pay process used by the company. Several factors could cause the GRNI balance to increase, including:<\/p>\n\n\n\n