How is a PO (Purchase order created)?

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Sarvottam Darshan

  • Feb 21st, 2006

A document or form used by a customer to issue an order for goods or services.

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  • May 7th, 2007

Purchases Order created by purchasing dept. based on production dept. requirement. 1st it (Purch. Dept.) invites quotations  from suppliers, based on appropriate quotation  it  order to supplier to supply the goods. it prepares P.O. in four to five copies - 1 is sent to fin.dept. 2nd to suppliers 3 rd to stores and last one keeps itself for ref.  P.O includes the info. about the Qty, Qlty, Prce, delivery conditions etc.


  • Apr 21st, 2008

Firstly the concerned department sends a requisition to Purchase Department.
For that requisition Purchase Department searches for Available Suppliers ( Sometimes from Old Database or by New market research).
With this information they discuss the requirement with suppliers and then prepare Comparative Rates Statement and keeping in view the reasonable rate, the lead time available and the terms of payment offered etc the supplier is finalized and then the Purchase Order is prepared for that Supplier.

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user creates a purchase requisition(PR)
then it must be approved by his head of department(HOD)
then PR is directed towards store if they have that material then it will be issued
if not , then it direct towards purchase department keeping in mind the budget of that department, purchase department raise quotations -  choose the best quotations both quality and rate wise
then raise po to that party 

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Purchase Order can be created in two ways:


A purchase order can be created automatically when a requistion is entered and approved, A purchase order can be generated automatically from that requistion.

A purchase order can be entered manually directly in the PO Entry window.

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  • May 8th, 2011

A PO is created because there is an interest in a product.  We make an agreement with an organization to purchase a product or service.  We then enter the agreement in a program, such as HOD, outlining the quantity, the product, the coding to issue payment to, the PO #, and an amount is set up in that account to pay the matching invoice when the service has been rendered and/or the product has been received.

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