What is GR/IR?
The clearing account that sits between receiving goods and receiving the invoice for them.
GR/IR: definition
In procure-to-pay, goods and their invoice rarely arrive at the same time. When you receive goods, you owe the vendor even before the invoice shows up; when the invoice arrives first, you owe before goods land. The GR/IR clearing account captures that timing gap and is cleared when both events match, surfacing any quantity or price discrepancy.
- Goods received before invoice: credit GR/IR (a liability) at receipt
- Invoice received: debit GR/IR, credit accounts payable
- A clean match clears the account to zero for that line
- A lingering GR/IR balance signals a missing invoice, missing receipt, or a mismatch
How Fintra handles it
Fintra runs goods receipt and invoice receipt through a GR/IR clearing account tied to its three-way match. When a PO, receipt, and invoice all agree, Fintra clears the GR/IR line automatically; when they do not, the exception is flagged for a human to resolve. Aged GR/IR balances are surfaced during close so nothing sits unreconciled.
Worked example
Frequently asked questions
What is the GR/IR clearing account for?
It bridges the timing gap between receiving goods and receiving the invoice for them, so your books reflect the obligation as soon as either event happens. It clears to zero once both sides match, and a residual balance flags a discrepancy.
Why would a GR/IR account have a balance?
A lingering balance usually means a missing invoice (goods received, never billed), a missing receipt (invoiced, never received), or a quantity/price mismatch. Reviewing aged GR/IR balances is a standard close control that Fintra automates.
How does GR/IR relate to the three-way match?
The three-way match compares the purchase order, goods receipt, and invoice. GR/IR is the accounting mechanism that records the in-between state and clears once the match succeeds. Fintra ties them together so matched lines clear automatically.
Do small businesses need GR/IR?
Any business that receives inventory or goods on purchase orders benefits from GR/IR discipline - it catches billing errors and prevents paying for goods never received. Fintra provides it as part of procure-to-pay without SAP-level complexity.
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