Purchase Orders in R12 and Create Standard Purchase Order
A Purchase order is a commercial document and first official order issued by the buyer to the supplier, indicating types, quantities, and agreed prices for products or services the supplier will provide to the buyer. Purchase order is required to fulfil demand. Demand can be raise by internal requisition, WIP, RMA. Only buyers can enter and auto create purchasing documents.
Purchasing provides the following purchase order types:
1) Standard Purchase Order
2) Planned Purchase Order
3) Blanket Purchase Agreement
4) Contract Purchase Agreement
Standard Purchase Order
Used for One-time purchases for goods and services. when you know the item, estimated costs, payment terms and delivery schedule.
Planned Purchase Order
Created when you have long-term agreement with the supplier. You must specify the details of goods and services, payment terms and the tentative delivery schedule.
Blanket Purchase Agreement
Created when the details of items and services, payment terms are known but not specific about the delivery schedule.
Contract Purchase Agreement
Created when the terms and conditions of a purchase are known but specific goods and services are not.
Standard Purchase Order
Navigate to Purchasing, Vision Operations Responsibility.
Purchase Orders > Purchase Orders
Status represents the status of the document. Incomplete is the default status for all purchase orders until they are submitted for the first time for approval.
Click Shipments button.
Shipment number, Org, Ship-to, UOM, Quantity and Need-by-date are shown by default. These fields can be edited as needed. You can split the lines and can change the ship-to Organization, quantity of items to be shipped and delivery date.
A Purchase Order has three main close points:
1) Closed for Receiving is specific to line.
2) Closed for Invoicing is specific to line.
3) Purchase Order itself has a closed status.
A tolerance of 0% indicates that it will close when the total amount received or invoiced equals the amount on the order, whereas a close tolerance of 100% indicates that no receipts or invoices are required for this order, which will close the lines for receiving as soon as the order is approved. Reviewing these default close tolerances on a regular basis is a good idea to ensure orders are properly controlled and closed with minimal intervention by the purchasing agent. The entire order will not close automatically unless both receiving and invoicing lines closed.
Select an option at Match approval Level
This determines the close point for an order.
2-way determines Purchase Order and Invoice quantities must match with in the tolerance before the corresponding invoice can be paid.
Quantity Billed = Quantity Ordered
Invoice Price = Purchase Order Price
3-way determines Purchase order, receipt, and invoice quantities must match within tolerance before the corresponding invoice can be paid.
Quantity Billed = Quantity Ordered
Invoice Price = Purchase Order Price
Quantity Billed = quantity Received
4-way determines Purchase order, receipt, accepted, and invoice quantities must match within tolerance before the corresponding invoice can be paid.
Quantity Billed = Quantity Ordered
Invoice Price = Purchase Order Price
Quantity Billed = quantity Received
Quantity Billed= Quantity Accepted
Select an Invoice Match Option
Purchase Order: Payables must match the invoice to the purchase order.
Receipt: Payables must match the invoice to the receipt.
Choose Receipt if you want to update exchange rate information on the receipt or if you want your accounting to use exchange rate information based on the receipt date. (If you use Periodic Costing, you must match to the receipt to ensure accurate cost accounting.)
Click Distributions button
You can split the lines and as the item is expense item allow to change charge account. In case of Inventory item the field will be disabled with default account .
Click Receiving Controls button
Receipt days determine maximum acceptable number of Days Early and Days Late to receive items.
Action determines how Purchasing handles at receipts
None - Receipts may exceed the allowed days early or late.
Reject - Purchasing does not permit receipts outside the selected number of days early or late.
Warning - Purchasing displays a warning message but permits receipts outside the selected number of days early or late.
Purchasing displays the Last Accept Date, which is the last date when the shipment can be received. This is the promised date plus the number of days late allowed.
Click Terms Button
Go to Tools> Preferences
Click Approve button
Click Ok button
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