Purchase Orders

Purchase orders are agreements between the Company and the vendor to purchase a defined quantity for an agreed price. The relationship for the vendor is initially defined in Products. The relationship defines the rules specific to the vendor and product such as units of measure, additional charges and taxes.  

There is an option in Admin>System>Permissions>Users to define purchase order levels for users. For  example, a user may only have the authority to create a purchase order up to $10,000. If that user enters a purchase order for an amount greater than $10,000, the user is unable to post the purchase order to make it available for receipt.

Purchase orders can be created for any type of product with the exception of Miscellaneous Products. All  products are considered to be inventory, however Field Products have the option for inventory and non-inventory products. Purchase orders can be created for non-inventory field products. Purchase orders must be assigned to a cost center. Multiple products and cost centers can be assigned to a single purchase order.

Purchase orders will be created based on the default currency assigned to the vendor with an option to modify the currency on the purchase order. The exchange rate will be initially defined at receiving based on the rate that is in effect on the receiving date and inventory value will be determined by that rate. When the purchase invoice is processed, the system will calculate the difference in the rate from receive date to invoice date and record the amount to foreign exchange gain/loss.

Purchase orders must be created and posted for a product to be received. Purchase orders will expire based on one of the following conditions being met:

• Quantity defined on the purchase order has been received in entirety.
• End Receive Date has been exceeded. If there is quantity remaining to be received, the End Receive Date will override the outstanding quantity.
• Purchase order is manually closed by user.

Optionally, an approval process can be implemented where a purchase order must be in approved status prior to being posted. Multiple levels and users can be assigned to the approval process. Further details can be viewed in Purchase Order Approval.

Prior to creating a new purchase order, the following items should be created::

• Vendors
• Products
• Add-ons
• Cost Centers

What do you want to do?

• Create a basic purchase order

• Create a purchase order with freight

• Create a freight-only purchase order

• Create a purchase order from a contract

• Create a market priced purchase order

• Create a consignment purchase order

• Create a prepaid purchase order

• Create a multi-currency purchase order

• Create a purchase order adjustment

• Approve a purchase order