Purchase order

A Purchase order is the means by which you record the quantity and price of goods or services that you are going to purchase from a Suppliers (Creditor), and the manner and date by which they are to be supplied.

A Purchase order can specify stock and non-stock Items of any price or quantity. When the goods are received, one or more Receives are created for some or all of the items specified on the Purchase order. The liability for the cost of the goods is not incurred for a Supplier’s account until the goods are Received.

After creation, a Purchase order is usually printed and faxed, mailed or e-mailed to the relevant Supplier.

The following can be said about Purchase orders:

  •  A Purchase order must specify exactly one Supplier (Creditor)
    • The Supplier cannot be changed if it has prepayments linked to it
    • The supplier cannot be changed to one of a different currency if a receive has already been made for it
  • You cannot create Receive goods or services without a Purchase order
  • A Purchase order is referenced throughout the system by its Purchase Order #
  • A Purchase order only specifies the requested price of goods or services: a subsequent Supplier invoice relating to the Purchase order may indicate different prices than those originally specified
  • All Items on a Purchase order can only be received into a single warehouse (specified on the Purchase order)

How to handle rounding of prices on Purchase orders or Supplier Invoices