Suggestions:
Yes, the system has the provision to close a Purchase order even if an advance is paid for the Purchase. Users can enter the Purchase voucher for the advance payment advance adjustment. A debit note can be entered against the payable voucher of the advances paid amount.
Purchase voucher and debit note both screens exist in the Finance -> Payables -> Purchase payables .
Purchase order close menu exists in SCM -> Purchase -> Purchase order -> Purchase order close.
Users will have to enter the PO number and reason for closure before closing the PO and confirming.
Note: Purchase Order can be closed when the order is not used in receipt.