ERP glossary: trading, purchasing, inventory and accounting terms explained
Plain-English definitions of 83 terms used by B2B trading, distribution and project-supply businesses, each with a worked example and a note on how 1flux handles it.
In short
This ERP glossary explains the 83 terms that come up when a B2B trading business quotes, buys, stocks, sells and closes its books, from quotation and purchase order to GRNI, VAT and consolidation. Every entry gives a one-sentence definition you can quote, a worked example, the common confusions and a short note on how 1flux handles it.
Trade abbreviations, decoded
Ten abbreviations you'll meet on purchase orders, delivery notes and invoices, each linked to its full entry.
B2B trading companies share a working vocabulary that generic ERP glossaries often miss. Buyers raise purchase orders, which in the UAE and Saudi Arabia are usually called LPOs. Stores teams sign goods received notes against the supplier’s delivery note, and accounts won’t process a supplier’s invoice until the receipt is confirmed. Customers expect their own PO number on your delivery note and invoice, and every tax invoice carries the seller’s tax registration number.
Tax and registration rules shape the paperwork too, and they differ by country. VAT is 5% in the UAE and 15% in Saudi Arabia, and India uses GST. Saudi businesses quote their commercial registration (CR) number and use the structured national address on contracts, invoices and deliveries. E-invoicing is already mandatory in Saudi Arabia, where every VAT-registered business has had to issue compliant e-invoices since 4 December 2021, and the UAE’s mandate starts in 2027.
| Abbreviation | Stands for | In one line |
|---|---|---|
| LPO | Local purchase order | The purchase order a buyer sends a supplier |
| LPR | Local purchase request | A quick request to buy locally, converted straight to an order |
| RFQ | Request for quotation | Asks suppliers to price specific items and terms |
| DN | Delivery note | Travels with the goods so the receiver can check and sign |
| GRN | Goods received note | The stores record of what arrived and in what condition |
| GRR | Goods receipt report | Accepts received goods into stock and the books |
| GRNI | Goods received not invoiced | Goods received but not yet billed by the supplier |
| TRN | Tax registration number | A business’s VAT registration number |
| CR | Commercial registration | The record that registers a business to trade in Saudi Arabia |
| DSR | Daily sales report | A salesperson’s end-of-day record of visits and next steps |
Browse the ERP glossary by topic
Each topic follows a business process, so related terms sit together.
Sales and CRM
19 terms
From the first enquiry to the cash in the bank: quotations, orders, deliveries, invoices and credit terms.
See all 19 termsProcurement and inventory
27 terms
From the first request to buy to the value of stock on the shelf: requisitions, receiving, counts and costing.
See all 27 termsStart with
Accounting
25 terms
The books of a trading company: ledgers and journals, accruals, currencies, consolidation, tax and the month-end close.
See all 25 termsStart with
ERP and platform
12 terms
What buyers meet when they compare systems: ERP, entities, access control, workflows, migration and AI.
See all 12 termsStart with
Looking for the end-to-end processes rather than single terms? Read the quote-to-cash guide and the procure-to-pay guide.
A–Z of ERP terms
Every term in the glossary, in alphabetical order, with a one-line definition.
A
ERP and platform
AI document extraction
Using AI to turn POs, invoices and other documents into structured data.
Procurement and inventory
Available to promise (ATP)
Stock you can still commit to new orders: on hand minus reserved.
B
C
Accounting
Chart of accounts (CoA)
The structured list of every account a business records transactions in.
Sales and CRM
Commercial registration (CR)
The record that registers a business to trade in Saudi Arabia.
ERP and platform
CRM (customer relationship management)
Software for managing customers, contacts, deals and sales activity.
Accounting
Currency translation difference
The balancing amount from translating a subsidiary's books at different rates.
Sales and CRM
Customer purchase order (customer PO)
The buyer's formal order to you, usually after your quotation.
D
Sales and CRM
Delivery note (DN)
The document that travels with goods so the customer can check and sign.
E
Accounting
E-invoicing
Issuing invoices in a structured format that tax systems can read and validate.
ERP and platform
ERP (enterprise resource planning)
Software that runs sales, purchasing, stock and accounting on one database.
F
Procurement and inventory
FIFO (first in, first out)
A costing method that uses the oldest purchase costs first.
G
Procurement and inventory
Goods receipt report (GRR)
The document that accepts received goods into stock and the books.
Accounting
Goods received not invoiced (GRNI)
A liability for goods received but not yet billed by the supplier.
Procurement and inventory
Goods received note (GRN)
The stores record of what arrived, from whom and in what condition.
I
Procurement and inventory
Item master
The central catalogue record for every item you buy, stock or sell.
J
L
Procurement and inventory
Landed cost
Supplier price plus freight, duty and clearing to get goods into stock.
Procurement and inventory
Local purchase order (LPO)
The Gulf name for a purchase order sent to a supplier.
Procurement and inventory
Local purchase request (LPR)
A quick request to buy locally that converts straight to an order.
M
N
O
P
Sales and CRM
Proforma invoice
A preliminary bill sent before goods ship or a final invoice is issued.
Procurement and inventory
Purchase requisition
An internal request to buy, approved before a supplier is contacted.
Q
Procurement and inventory
Quote comparison
Supplier offers side by side, to choose one and record why.
R
Procurement and inventory
Request for quotation (RFQ)
A request asking suppliers to price specific items and terms.
ERP and platform
Role-based access control (RBAC)
Granting permissions through job roles rather than person by person.
S
T
Sales and CRM
Tax registration number (TRN)
The number a tax authority gives a VAT-registered business.
U
V
W
Procurement and inventory
Warehouse management system (WMS)
Software that directs work inside a warehouse, down to bin level.
Procurement and inventory
Weighted average cost
A costing method that values all units at their average cost.
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Is an LPO the same as a purchase order?
Yes. LPO stands for local purchase order, the name commonly used in the UAE, Saudi Arabia and the wider Gulf for a purchase order a buyer sends to a supplier. Suppliers usually need the LPO number before they deliver, and it should appear on their delivery note and tax invoice. An LPR, or local purchase request, is different: it's an internal request to buy, not an order.
What's the difference between a GRN and a GRR?
A goods received note (GRN) records what physically arrived at the warehouse: the supplier, the delivery note number, the quantities counted and their condition. A goods receipt report (GRR) is the controlled acceptance that follows. It ties the delivery to the right purchase orders, records short, over and rejected quantities with reasons, and posts the stock and the accounting entry. Some companies use one document for both steps.
What's the difference between a TRN and a CR?
A TRN, or tax registration number, identifies a business for VAT and is issued by the tax authority: the Federal Tax Authority in the UAE or ZATCA in Saudi Arabia. A CR, or commercial registration, registers a business to trade in Saudi Arabia and is issued by the Ministry of Commerce. Saudi invoices and letterheads often show both. The UAE's nearest equivalent to a CR is the trade licence.
What's the difference between a proforma invoice and a quotation?
A quotation offers a price for the customer to accept or decline. A proforma invoice comes later, when the buyer intends to order: it sets out the expected bill so the buyer can arrange payment, a letter of credit or an import permit. Neither is a tax invoice, and neither records a sale or any tax due. The tax invoice is issued when the goods or services are supplied.
What's the difference between ERP and accounting software?
Accounting software records financial transactions: invoices, bills, payments and the ledger. An ERP also runs the operations that create those transactions, such as quotations, sales orders, purchasing, receiving and stock, and posts the accounting from them, so sales, the warehouse and finance work from the same records. Trading companies often move to an ERP when re-keying orders between spreadsheets and an accounting package starts causing errors.
Quote-to-cash guide
The eight stages from enquiry to cash in the bank, with the documents, controls, KPIs and a checklist.
Procure-to-pay guide
Eleven steps from requisition to supplier payment, with the documents, controls, accounting, KPIs and a checklist.
ERP buyer's guide
How to choose an ERP: requirements, vendor questions, demo scripts, five-year cost and a scoring table.
FAQ
Straight answers about 1flux: modules, AI, Arabic data, VAT, e-invoicing, security and pricing.
Resources
Guides, a glossary, the FAQ, blog posts and comparisons for B2B trading businesses.
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See these terms working in one system
Book a demo and follow a quotation, a purchase order, a GRN and their journal entries through 1flux.
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