Pro Forma Invoice

Invoice Types

A preliminary bill of sale sent before goods or services are delivered.

Detailed Explanation

A pro forma invoice is an estimated invoice sent to buyers before a purchase is finalized. It outlines the products or services to be provided, quantities, prices, and terms of sale, but it's not a demand for payment. Pro forma invoices are commonly used in international trade for customs clearance, to secure financing, or to give customers an accurate preview of costs before committing to a purchase. Unlike standard invoices, pro forma invoices don't require payment and aren't recorded as accounts receivable.

Examples

  • An exporter sends a pro forma invoice for customs documentation
  • A supplier provides a pro forma invoice for a large order requiring approval

Quick Q&A

What is Pro Forma Invoice?

A preliminary bill of sale sent before goods or services are delivered.

What does "Pro Forma Invoice" mean?

A pro forma invoice is an estimated invoice sent to buyers before a purchase is finalized. It outlines the products or services to be provided, quantities, prices, and terms of sale, but it's not a demand for payment. Pro forma invoices are commonly used in international trade for customs clearance, to secure financing, or to give customers an accurate preview of costs before committing to a purchase. Unlike standard invoices, pro forma invoices don't require payment and aren't recorded as accounts receivable.

When is Pro Forma Invoice used?

An exporter sends a pro forma invoice for customs documentation ; A supplier provides a pro forma invoice for a large order requiring approval

Related Terms

Invoice Quote / Estimate Commercial Invoice Purchase Order (PO)

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