Purchase Orders

Overview

A purchase order is an order that lists supplier products or services you wish to buy, their quantity, quality, price, payment, and delivery terms.

To enable purchase orders:

1. Go to Master data and settings > Purchasing.
2. Select Purchase orders to use these documents in the system.

Purchasing Goods to Warehouse

The simplest scenario is purchasing the goods to fulfill stock balances. In this case, you can create a purchase order manually.

1. Go to Purchasing > Purchase orders.
2. Click Create > New.
3. Select the Vendor, Counterparty (if enabled in the system), Company, Terms of purchase (if used), Contracts (if required by Terms of purchase), and Warehouse.
4. Click Payments: not configured to set up payment steps.
5. Check that the AR/AP accounting, Payment schedule, Payment method, and Bank account fields are filled based on the Terms of purchase or enter the data manually.
6. Add payment milestones.
7. Click Apply.
8. Click the More tab and specify any required details.
9. Select the Currency of the order.
10. In the Taxation field, specify if it is subject to VAT, not subject to VAT, or it is a reverse VAT charge transaction.
11. Specify the reference Vendor reference number and Date according to the counterparty's information system.
12. To register vendor prices automatically for further purchases, select the Register vendor prices automatically checkbox.
13. Click the Delivery tab (if available), select a Delivery method and fill the required information that depends on the delivery method.
14. Click the Goods tab and add the required products.
15. Specify the Quantity.
16. Fill in Prices and Manual discounts (if applicable).
17. Select the One-day shipping checkbox and specify the Shipment date for the order.
18. Specify the Priority for the document.
19. If purchase order statuses are used, select the Pending approval status (if approval is required) or the Approved status (if approval is not required).
20. Click Post.

Purchasing Goods Under Sales Orders

To generate a purchase order based on a sales order:

1. Go to Sales > Sales orders.
2. Select the required order and click Generate > Purchase order.
3. Select a Counterparty.
4. If applicable, select a Contract signed with the Counterparty.
5. If applicable, select the Terms of purchase.
6. Click the Goods tab.
7. Apply Price type to fill Price.
8. Specify other required information.
9. Click Post.

Approving Purchase Orders

If you are going to approve purchase orders, set it up first:

1. Go to Master data and settings > Purchasing and select the Approve purchase orders checkbox (available if the Purchase order statuses checkbox is enabled in the Purchasing settings).
2. Assign approvers to the following roles:
   • Logistic conditions approver.
   • Financial conditions approver.
   • Price conditions approver.
   • Commercial conditions approver.

To initiate an approval process:

1. Go to Purchasing > Purchase orders.
2. Open the order in the Pending approval status.
3. Click Approval at the top.
4. Click Create.
5. Describe what exactly you ask to approve in the Details field, specify the Planning date of the approval, the Importance and Emergency.
6. Click Start.
7. As a purchase manager, you will receive the approval results in Quick menu > My tasks. Review the information from other approvers and take the necessary actions.

The system will automatically set the status to Confirmed as soon as all participants approve the order. It’s not really correct, as the Confirmed status usually means the order is confirmed with the supplier.

If the approval is not required, set the Approved status manually. Then, send a final confirmation to the vendor regarding the placement of the order. Once you receive the confirmation from the vendor, set the Confirmed status for the order.

Following up Purchase Orders

Purchase Order Fulfillment Statuses

1. Go to Purchasing > Purchase orders.
2. Open the Current status filter.
   • Pending approval. The purchase order is pending internal approval.
   • Pending payment before confirmation. You must make an advance payment before the vendor commits to delivery. This is defined in the payment terms.
   • Confirmation is expected. The vendor confirms delivery obligations.
   • Pending payment before purchase. You must make a prepayment to start the shipment process. This is defined in the payment terms.
   • Ready for receipt and Expecting receipt. All conditions before delivery, including prepayments, are fulfilled. The warehouse employee is informed about expecting goods receipt.
   • Pending payment. Goods are received. The invoice is registered, and waiting for payment.
   • Fulfilled. The manager must close the order.
   • Closed. The order is fulfilled.

Controlling Payments

1. Go to Purchasing > Purchase orders.
2. Select the order with Pending payment before confirmation, Pending payment before purchase, or Pending payment state.
3. Click Reports > Fulfillment status.
4. In the Fulfillment state report, in the Payment steps column, find Payment before confirmation / Payment before purchase / Payment after shipment / Payment regardless of shipment.
5. Check the Payment date.
6. Check the Plan, Actual, and Overdue payment figures.
7. Notify the finance manager about an overdue payment.

Controlling Vendor Confirmations

1. Go to Purchasing > Purchase orders.
2. Select the order with the Confirmation is expected state.
3. Ask the vendor to confirm order commitments to deliver goods on time.

Controlling Delivery of Goods and Invoices

1. Go to Purchasing > Purchase orders.
2. Select the order with Ready for receipt or Expecting receipt state.
3. Click Reports > Fulfillment status.
4. Check Goods and Invoices receipt states.
5. Notify the vendor about difficulties with delivery of goods, and invoicing.