What is the difference between Purchase Ledger and Sales Ledger?

The structure of a Finance team can at first appear complex. There’s purchase ledger, then there’s sales ledger, or is it accounts payable? Wait, is it accounts receivable? What’s credit control then? It’s no wonder people get confused!

For those looking to embark on a career in Finance you may wonder what the best route is for you. Here’s our quick overview of the differences between Purchase Ledger and Sales Ledger.

To put it simply, purchase ledger is the stuff the company buys and sales ledger is the stuff the company sells to others. From our point of view, sales ledger is typically the administrative side of Credit control – i.e. ensuring the product that has been sold, is recorded correctly including any tax and VAT and creating a bill, also known as an invoice, to send to clients. Whilst credit control is typically more focused on outbound telephone work chasing payments.

Both Purchase Ledger and Sales Ledger roles involve working with the wider business. In a Purchase Ledger role you will often need to speak to other team members to get authorisation for invoices to be paid. As a Sales Ledger Clerk or a Credit Controller you will sometimes have to speak to the sales team about a particular customer to understand who worked with this person, what was sold to them and if there were any special conditions.

Working in purchase ledger you’ll be responsible for processing purchase orders and expenses, whilst sales ledger duties include producing invoices and chasing up outstanding debts.

If you’re new to the Finance team and you’re considering which role would suit you best, here are some things to think about –

  • Do you have good attention to detail? If the answer is yes, purchase ledger could be a good option for you!
  • Are you confident in speaking with customers? If the answer is yes, sales ledger (or credit control specifically) may be well suited to you.
  • Do you enjoy persuading customers and hitting targets? If it’s yes, quiet often ‘credit controllers’ are targeted on debt recouped and sometimes number of calls!
  • Do you enjoy dealing with and fixing queries? If yes, purchase ledger could be the right path for you.
  • Do you like creating solutions for people and negotiating where needed? If yes, sales ledger might be for you! Quiet often, people are resistant to pay, so you have to be able to come up with payment plans or accepting a smaller amount (for now)!

For further insight, click here to check out our other blogs. If you’re looking for your next role, get in touch with our team at [email protected] to see how we can help!

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The Niche Partnership

The Niche Partnership

We specialise in the recruitment of accountancy and finance professionals across the South. Contact us for more information or to submit your CV.

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