Considered as a binding agreement between exporter and importer. May be required by some countries as part of their import licensing procedures. Bankers and financial institutions use pro forma invoices to open letters of credit, advance payments, etc., for importers.

Easily recognized due to their similarity to commercial invoices. Pro forma invoice format encourages exporters to include all the information that shall appear in the commercial invoice.

Keep the following points in mind when your company is asked to produce a pro forma invoice:

� The title of the document should clearly say "Pro Forma Invoice".
� Exporter's name, address, telephone number and e-mail address.
� Sold to name, address, telephone number and e-mail address.
� Pro forma invoice reference number.
� Date issued. The date of the pro forma invoice is the date of the quotation.
� Customer�s Inquiry reference number or purchase order number, if available.
� Terms of payment (letter of credit, documentary collection, pre-payment, T/T, open account etc.).
� Exporters banking details for advising /negotiating LC or SWIFT code details for Wire Transfer.
� Estimated date of shipment.
� If more than one product, number each product beginning with number 1.
� Type of Delivery & shipment : Full in one lot or partial.
� Indicate Transshipment if any,
� Quantity shipped per lot.
� Full product description, include the Harmonized Schedule (HS) code if available.
� Indicate clearly currency used (USD, Euro, Yen etc.).
� Unit pricing should be included.
� Unit pricing should be extended by the quantities quoted to form the line item total.
� Any additional supplies-provided services should be itemized and should be added to reach a grand total.
� Terms of sale using latest INCOTERMS (FOB, CIF, CFR, DDU etc.- named port or destination).
� Identify the number of unit measure, weight, case, pallets, box, etc.,
� The country of origin of the product.
� Cost of any additional documents, inspection, legalization, etc., to be borne by the importer or exporter.
� Validity period, never make open-ended commitments remember that the validity date can be changed.
� Must be signed and title to be included.
� Column for Acceptance with Signature, title of the buyer to be incorporated in PI or covering letter.

Remember that pro forma invoices are formal offers to sell. When the buyers agree with all the terms and conditions of the pro forma invoice the result is a purchase order sent by the buyer, which finally leads to a sales contract that is, if the buyer and the exporter agree to have a formal sales contract. The pro forma and purchase order must be compared before goods are shipped to check for discrepancies. Should there be a discrepancy, the buyer should be promptly notified to correct any errors.

Commercial Invoice

Prepared after the sale takes place, the commercial invoice is the final bill from the exporter to the buyer that conforms in all respects to the agreement. It could have the exact terms of the pro forma invoice first offered, or it could differ in those terms that were the result of final negotiations. Commercial invoices are also used by governments to determine the true value of goods for assessing Customs duties, examining goods and gathering statistics. Additionally, many countries use commercial invoices to control imports. It is critical for the exporter to check with the buyer the type of information that must be included in the commercial invoice in order to clear Customs in the buyer's country. Here are few key areas to consider when producing a commercial invoice.