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A Proforma Invoice is an important document that is created by the seller of goods.The Proforma invoice will include the seller's bank details so that the buyer can arrange payments as required.

Like a regular invoice, proforma invoices should include contact details, a date of issue, a description of the goods or services provided, the total amount due, and any VAT. They might also include payment terms such as which methods of payment you accept and when payment is expected.

Proforma invoices are not legally binding and are not counted as official sales in your accounting department. Traditional invoices confirm a purchase or sale, whereas proforma invoices are just a way to establish the terms of the sale.

Proforma Invoices are usually used for customs purposes only, often where unsold goods are being shipped. Commercial Invoices are usually used where sold goods are being shipped.

Importers use pro forma invoices when declaring the value of goods in a shipment for customs clearance.The customer will use this statement to pay the bill, and will keep it for tax and accounting purposes.

Proforma invoices are preliminary invoices that inform clients about the terms of sale. The preliminary invoices are created for internally checking invoices or for enabling customers to check their invoices. The invoices are not included in accounts receivable and payable.

As a proforma invoice is not a legally binding document, or the official invoice used for accounting, they do not need to be cancelled. Similarly to a quotation document, if the sale does not go ahead, no action is required to edit or cancel the proforma invoice.