How to Use Sales Order and Purchase Order in Tally Prime (2026)

Not every transaction starts with an invoice. Often you’re confirming a customer’s order before you’ve shipped anything, or placing an order with a supplier before goods arrive. Sales Orders and Purchase Orders in Tally Prime let you record that commitment, track what’s still pending, and convert it into an actual invoice once the transaction completes — without re-typing everything from scratch.

This guide covers recording both order types and converting them into invoices.

What You Need Before You Start

• Tally Prime installed, with your sales/purchase ledgers and party ledgers already set up — see our guide on how to record purchase and sales entries in Tally Prime
• Stock items created if you’re dealing in goods, with units and rates configured

Step 1: Enable Order Processing

1. Gateway of Tally, then F11 (Features), then F2 (Inventory Features)
2. Set Allow Purchase Order Processing and Allow Sales Order Processing to Yes
3. Press Ctrl+A to save

Step 2: Record a Sales Order

A Sales Order records what a customer has committed to buying, before you’ve actually delivered or invoiced it.

1. Gateway of Tally, then Vouchers, then Alt+F5 (or select Sales Order from the voucher list)
2. Party A/c Name: select the customer ledger
3. Enter an Order Reference Number if the customer gave you one, and the order date
4. Add the items, quantities, and agreed rates
5. Optionally enter an Expected Delivery Date for each item or the order overall
6. Press Ctrl+A to save

This doesn’t affect your stock or your books yet — it’s a record of commitment, not a financial transaction.

Step 3: Record a Purchase Order

A Purchase Order records what you’ve committed to buying from a supplier, before the goods have arrived or been invoiced.

1. Gateway of Tally, then Vouchers, then Alt+F4 (or select Purchase Order from the voucher list)
2. Party A/c Name: select the supplier ledger
3. Enter your internal order number/reference and date
4. Add the items, quantities, and agreed rates
5. Optionally enter an Expected Delivery Date
6. Press Ctrl+A to save

Step 4: Track Pending Orders

1. Gateway of Tally, then Display More Reports, then Statement of Inventory, then Order Outstanding
2. View Sales Order Outstanding to see what customers are still waiting on
3. View Purchase Order Outstanding to see what you’re still waiting to receive from suppliers
4. Use these reports to follow up before delivery dates slip

Step 5: Convert a Sales Order into a Delivery Note and Invoice

Once you actually ship the goods:

1. Gateway of Tally, then Vouchers, then Delivery Note (Alt+F8)
2. Select the customer and use the option to bring in details from an existing Sales Order rather than re-entering everything
3. Confirm the quantities being delivered (this can be the full order or a partial delivery)
4. Save the Delivery Note, which updates your stock
5. When you’re ready to invoice, create a Sales Voucher (F8) and again pull details from the Sales Order or Delivery Note, rather than typing the invoice from scratch

Step 6: Convert a Purchase Order into a Receipt Note and Purchase Invoice

When goods actually arrive from your supplier:

1. Gateway of Tally, then Vouchers, then Receipt Note (Alt+F9)
2. Select the supplier and pull in details from the existing Purchase Order
3. Confirm the quantities actually received (which may be less than ordered, if it’s a partial delivery)
4. Save the Receipt Note, which updates your stock
5. When the supplier’s invoice arrives, create a Purchase Voucher (F9) and pull details from the Purchase Order or Receipt Note

Handling Partial Deliveries

Both Sales Orders and Purchase Orders support partial fulfillment — you don’t need to receive or deliver the full ordered quantity in one go. Tally Prime keeps track of what’s still outstanding on the original order after each partial delivery or receipt, so the Order Outstanding reports stay accurate.

Common Mistakes to Avoid

• Skipping the order stage entirely and only recording the final invoice, losing the ability to track what’s pending or overdue from customers and suppliers
• Manually re-typing item details into the invoice instead of pulling them from the existing order, which risks mismatches between what was agreed and what was actually billed
• Not updating expected delivery dates when they change, leaving your Order Outstanding report misleading
• Forgetting to record a Delivery Note or Receipt Note before invoicing, which skips the stock movement step and can make your inventory reports inaccurate
• Closing out an order as fully delivered when only a partial quantity actually went out, losing track of the remaining balance owed to the customer or supplier

FAQs

Do Sales Orders and Purchase Orders affect my stock or accounts immediately? No. They’re a record of commitment only. Stock updates happen at the Delivery Note / Receipt Note stage, and your books update at the actual invoice stage.

Can I cancel a Sales Order or Purchase Order? Yes, you can alter or cancel an order voucher before it’s been converted, as long as no delivery or invoice has been recorded against it yet.

What if a customer changes the quantity after I’ve already recorded the Sales Order? Open and edit the original Sales Order to reflect the new quantity, ideally before any partial delivery has gone out against it.

Is a Delivery Note the same as an invoice? No. A Delivery Note records the physical movement of goods out of your stock. The Sales Invoice is the financial document that bills the customer. You typically need both, in that order.

Can I generate a GST invoice directly from a Sales Order without a Delivery Note? You can skip the Delivery Note step for simple transactions if your workflow doesn’t require separate tracking of stock dispatch, but using one keeps your inventory reports more accurate, especially for partial deliveries.