Accountant won't send an invoice without a PO
I've outsourced accounting including AP, AR, Rev Rec, etc. I have an unbilled revenue problem, where my accountant won't send invoices unless we have a PO! This is a problem because even though I write SOWs to say that we will send an invoice when specific things happen, in practice we don't!
My accountant says it's best practice to avoid issues where some information may be wrong or the customer doesn't accept it, but in my mind no customer will ever pay if we don't send an invoice and even if some reject it because they haven't sent a PO, not all will and I feel I'm still legally owed reimbursement based on the SOW. If I never send an invoice my customer legally owes me nothing!
Am I wrong? I'm not an accountant myself so I defer to her, but is it really a bad idea to send invoices if I don't have a PO yet? (Or an affidavit from the customer saying they don't require POs)
EDIT:
Based on the comment I want to add: I agree that I am owed the money regardless of whether there is a PO or even whether or not I invoice. However my SOWs state that the customer must pay within x days of receiving the invoice, so the clock never starts if I don't send an invoice. Also I agree it's a risk to start work without a PO but I don't feel that's an option (and my accountant can't stop me) but many customers just really drag their feet on getting me a PO. What I'd like to do in those cases is submit an invoice to get the clock started so that whenever I do finally get the PO I don't have to wait another 120 days.
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It depends on company size and policy.
The place I work for (an XXL company) would throw your invoices in the trash if there is no PO referenced on it, and we couldn't pay you if we wanted to without one.
Small companies never bother to create a PO, they order via mail or phone call or handshake agreement.
Anything in between is possible.
That means for small to medium sized companies, you have a pretty good chance that if your contact accepts your invoice as valid, you get paid.
For large companies, it is a risk to even start work without a PO because many things can happen, and you might never get one (and therefore never get paid). There is a process to legally binding guarantee you payment before the PO, it is called 'LoA' (Letter of Authorization) or 'NTP' (Notice to Proceed), either one mostly gurantees you that there will be a PO one day, and you will get paid. I would watch for those terms when they tell you to start work.
Pick up the phone get a hold of the buyer's accounting department. Let them know work was done per SOW-XXX (reference the SOW), and you never received a PO, and you need a PO number to invoice the work. Rope your accounting people in and let the buyer's accounting department know that's where they need to send the PO or the PO number, at least. You can work out the details with them, such as whether a direct non-PO invoice will work, or what you can reference to get the invoice paid. Get their email and CC whatever manager you deal with on their end and dispatch an email after the fact that summarizes the call.
You can worry about internal controls after the fact. Controls only work if you employ them front-to-back. e.g. I need a PO to submit an invoice but work was completed without ever requesting a PO and so that control goes out the door.
A PO is a document that is a product of your customer's accounting practices, not your own. You need to find out if your customer requires a purchase order prior to invoicing or not. Some will require it. Others will not. Finding out topically requires asking the person who signed the statement of work to check with their procurement department or put you in touch with someone in that department. If they don't have a procurement department, it's possible they won't require a PO.
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