GRNI (goods received not invoiced): the value of goods you've received from a supplier but haven't been billed for yet. It sits in a GRNI account until the bill arrives, then it's cleared.
GRNI stands for goods received not invoiced. It is the value of goods you have received from a supplier but haven't yet been billed for. You own the goods and you owe the money, so both belong in your accounts, even though no bill exists yet. The GRNI account (sometimes called accrued purchases) holds that amount until the supplier's bill arrives, and is then cleared.
In short: receive the goods, record a GRNI amount; receive the bill, clear it. The balance on the GRNI account at any date should equal the goods you've received and are still waiting to be billed for, and nothing else.
GRNI meaning in plain English
Think of GRNI as a holding bay. Goods arrive at the warehouse or site before the paperwork does. Without GRNI, those goods are invisible to your accounts until the bill is entered, so your stock and what you owe both look smaller than they really are. With GRNI, the receipt is recorded straight away against a temporary account, and the bill later takes its place.
You'll mostly see GRNI where businesses buy against purchase orders: wholesalers and distributors, manufacturers, and builders and contractors buying materials for jobs. It is one step in the broader purchase-to-pay process, which covers the full cycle from requisition to payment.
A simple worked example
This example uses illustrative round numbers. They don't come from any real business.
For example, say you raise a purchase order for 100 cartons at $40 each, so $4,000 of stock.
- 28 June: the goods arrive. Your team receives all 100 cartons against the purchase order. Inventory goes up by the value of the cartons, and the GRNI account goes up by the same amount.
- 30 June: month-end and year-end. No bill has arrived. Your balance sheet still shows the cartons as stock and the amount owed sitting in GRNI. That's the whole point.
- 5 July: the bill arrives for the purchase order amount. The GRNI amount is cleared and the supplier's bill goes to accounts payable as normal. GRNI for this order is now zero.
Now a variation. For example, suppose the bill is for $4,200 because the supplier added freight. The extra $200 has to go somewhere: into the stock cost if the goods are still on hand, or to a price variance account. Your accountant should decide which, and your systems should apply that rule every time.
The reverse also happens: goods invoiced not received (GINR), where the bill arrives before the goods.
Is GRNI an asset or a liability?
GRNI is normally a liability, because it represents money you owe a supplier for goods you've received. Some systems let you map it to a current asset or current liability account. Check with your accountant how it should appear in your reports.
Why GRNI goes wrong when purchasing, receiving and accounts are in different systems
GRNI only works if three things agree: what was ordered, what was received, and what was billed. In many businesses those live in three different places. Purchase orders are raised in one system, goods are received in a warehouse or job system, and bills are entered in the accounting software. That's a classic case of information stuck in separate systems.
When the systems don't talk properly, the same few problems appear:
- Bills entered straight into the accounts. The bill goes to accounts payable, but the GRNI entry in the inventory system is never cleared. The GRNI balance grows every month.
- Receipts nobody records. Goods are signed for at the dock or on site, but the receipt isn't entered until the bill turns up, so GRNI is always understated.
- Price differences with no rule. The purchase order said one price, the bill says another, and nobody decides where the difference goes. Stock costs and margins drift.
- Freight and duty from other suppliers. These belong in the stock cost, not in GRNI for the product supplier. See our landed cost page.
- Part deliveries and part bills. Easy to match wrongly, and they leave small amounts behind.
- Two stock values. The inventory system shows one stock value and the ledger shows another, so your systems give different numbers and no one is sure which to trust.
When it's fixed, it looks like this: on the first working day of the month, a report lists every open receipt by supplier and age, its total matches the GRNI balance in the accounts, and the only items on it are bills you're genuinely waiting for.
How inventory systems handle GRNI
Each system does this a little differently, so check yours rather than assuming.
- Inventory apps connected to accounting software. Cin7 Core, for example, has an optional inventory accrual setting. When it's on, receiving stock posts a journal that debits inventory and credits the GRNI account at the receipt date, using the purchase order cost; when the bill is authorised, the accrual is reversed and the bill posts to accounts payable (Cin7 Core help). Other inventory apps handle receipts and bills in their own way, so ask your provider exactly what is posted, and when.
- ERPs. Systems such as MYOB Acumatica, MYOB Exo or ERPNext usually have a built-in goods received account. The question is whether the ERP keeps the accounts itself, or sends summaries to separate accounting software. If it sends summaries, make sure the GRNI balance goes across too.
- No accrual at all. The accrual can be posted as a month-end journal from a list of open receipts. That works, but someone has to reverse it next month.
The month-end GRNI check
- List open receipts in the system where goods are received: supplier, date and value of every receipt with no bill matched.
- Run the GRNI balance in the accounts at the same date.
- Compare the two. They should match. If they don't, look for bills entered directly in the accounts, bills matched to the wrong receipt, and manual journals to the GRNI account.
- Age the list. Receipts older than a month or two need chasing: a lost bill, a duplicate receipt, an unprocessed return or a price dispute.
- Chase or clear. Ask suppliers for missing bills, fix duplicate receipts, and agree with your accountant how to treat anything that will never be billed.
- Record the result so next month starts from a known position.
When it's a set-up fix and when it isn't
If you use one inventory system connected to your accounting software, turning the accrual on, setting the account up properly and doing the month-end check is usually enough.
It gets harder when purchase orders, receipts and bills sit in different systems, bills arrive through a bill-capture app or EDI, freight is billed separately, or several entities buy for each other. That's where the matching between systems needs to be built, not done by hand each month. Our inventory management consultant and warehouse integration services cover that work, and our procure to pay guide shows how buying, receiving and paying fit together. If approvals are part of the problem, see purchase order approvals across systems.
Frequently asked questions
What does GRNI mean?
Goods received not invoiced: goods you have received from a supplier but haven't been billed for yet. The GRNI account holds their value so your stock and what you owe are both in the accounts.
What's the difference between GRNI and accrued purchases?
They're often used to mean the same thing. GRNI is the term usually used for goods received against a purchase order; accrued purchases or accrued expenses can also cover services.
Why does my GRNI account keep growing?
Usually because bills are entered directly in the accounting software instead of being matched to the receipt, so the GRNI amount is never cleared. Duplicate receipts and unprocessed returns also leave amounts behind.
Should the GRNI balance ever be negative?
Not normally. A negative balance usually means bills were matched to the wrong receipts, a bill was entered twice, or a receipt was deleted after its bill was matched. It's a sign to check the matching.
What happens to GRNI at month-end?
At month-end, the GRNI balance should equal the value of goods you've received but still haven't been billed for. Those goods are in your stock and the amount owed is in GRNI, so the balance sheet is right even though the bills haven't arrived. Run the open-receipts list from your purchasing or inventory system, check that it adds up to the GRNI balance in the accounts, and chase anything old. The steps are in the month-end GRNI check above. Matching each bill to its purchase order and receipt (often called three-way matching) is what keeps the balance clean between month-ends.
Do I need GRNI if bills usually arrive with the goods?
If bills almost always arrive the same day as the goods, the timing difference is small. It still matters at month-end and year-end, so many businesses use it anyway. Ask your accountant.
If your GRNI account doesn't make sense any more, or your purchasing, receiving and accounts live in different systems, book a free initial chat. We'll look at where the matching breaks and tell you honestly whether it's a set-up fix or something bigger. For a full written review of how your systems fit together, see our $5,000 Process & Systems Audit.