What is a PO (Purchase Order)?

What is a PO (Purchase Order)?

A Purchase Order (PO) is a formal document issued by an organization to a vendor to confirm the purchase of goods or services. It outlines the details of the order, such as quantities, prices, delivery terms, and payment conditions, and serves as a binding agreement between the buyer and seller.

There are two types of POs:

  1. PO with PR (Purchase Requisition):
    This PO is created based on an approved Purchase Requisition (PR). The PR is consumed by the PO, ensuring that the order aligns with the previously approved requisition. Multiple PRs can be consumed into one PO.

  2. PO without PR:
    This PO is created independently, without needing a preceding PR. It is typically used for direct purchases or in cases where no prior requisition is required.

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      The Vendor Mode of PO is a version of the purchase order that is tailored for the vendor's view. It includes essential details like the PO number, PO date, company logo, and signature. Only a subset of fields in the original PO are shown in the ...

    • What is a PR (Purchase Requisition)?

      A Purchase Requisition (PR) is an internal document raised by a user or department to request the purchase of goods or services. It initiates the procurement process and goes through an approval workflow before a purchase order (PO) is created. Easy ...

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