Purchase requisition

As part of an organization's internal financial controls, the accounting department may institute a purchase requisition process to help manage requests for purchases. Requests for the creation of purchase of goods and services are documented and routed for approval within the organization and then delivered to the accounting group.

Typically an accounting staff member is assigned responsibility for purchase order management, referred to commonly as the PO (purchase order) Coordinator.

Purchase requests are tracked against both internal departmental budgets as well as general ledger (GL) categories.

Structure

A purchase requisition is an authorization for a purchasing department to procure goods or services. It is originated and approved by the department requiring the goods or services. Typically, it contains a description and quantity of the goods or services to be purchased, a required delivery date, account number and the amount of money that the purchasing department is authorized to spend for the goods or services. Often, the names of suggested supply sources are also included.

A purchase requisition is owned by the originating department and should not be changed by the purchasing department without obtaining approval from the originating department. This important distinction (e.g. essential control) is not clearly defined in some of the more popular integrated procurement software systems on the market today.

In some industrial (e.g. production line) environments, the purchasing department may be assigned responsibility for requesting and purchasing goods. This is especially true for raw material purchases where the purchasing department is also responsible for inventory management.

A purchase requisition is not a purchase order and therefore should never be used to purchase goods or services or be used as an authorization to pay an invoice from a supplier or service provider.