How to Record Payments to Nominated Suppliers
Paying a supplier nominated by the client directly, in accordance with the main contract.
| Account Name | Type | Debit ($) | Credit ($) |
|---|---|---|---|
| Work-in-Progress (WIP — Nominated) | Asset (+) | 80,000.00 | - |
| Accounts Payable (Nominated Supplier) | Liability (+) | - | 80,000.00 |
💡 Accountant's Note
Nominated suppliers are selected by the client but contracted through the main contractor. Their costs are included in the main contract value and in WIP.
Practitioner & Systems Framework
💻 ERP Architecture
Process invoices through standard AP, but tag them as 'Nominated'. This is important because main contractors usually charge a pre-agreed attendance/profit percentage mark-up on nominated supplier invoices when billing the client.
⚠️ Audit Flags
Principal vs Agent analysis (IFRS 15). Auditors check if the main contractor bears inventory and credit risk for the nominated supplier. If they do not, revenue should only be the contractor's margin (net), rather than grossing up the revenue and costs.
📄 Required Documentation
Client instruction to use nominated supplier, supplier tax invoice, and Principal vs Agent accounting memo.
Automate this entry with the JEH Accounting Suite
Stop doing manual entry. Our VBA-powered ERP automatically generates your ledgers, Trial Balance, and Financial Statements.
No Subscriptions. Own your data.
Expert Analysis by Qusai Ahmad
General Accountant Supervisor & IFRS Specialist
Specialized in SAP GUI automation and Middle Eastern tax compliance. Building digital tools for the next generation of finance leaders.