Purchase orders (PO) are a fundamental part of the end-to-end accounts payable process within a company and help businesses provide transparency when managing their resources and relationships with suppliers.
Roles and responsibilities
In the Payhawk system, employees who can create purchase requests are called requesters. Requesters can also delete purchase requests before sending them for approval, submit them for approval, and upload receipt notes to purchases.
All employees can upload and link invoices to purchases and submit the expense for approval.
The setting of the numbering convention, discrepancy rules, purchase request approvals, payment approval workflows, and expense categories that require receipt notes, is done by Payhawk administrators.
Lifecycle of purchases
The following table summarizes the tabs under which a purchase is positioned depending on its status, based on the approval workflows at your company.
Tab | Details |
Draft | The Purchases > Draft tab contains purchases that have been created but not submitted yet.
From here, requesters and authorized people and roles can: Once submitted, the purchase will automatically:
|
Pending approval | The Purchases > Pending approval tab contains all purchases that have the Approve option in Workflows set and are pending approval.
Approvers can approve them directly in the Purchases app.
Requesters can:
Except for the option to edit the purchase, authorized people and roles have the same options as the requesters. Additionally, they can return the purchase to the employee.
When a purchase is approved, it will automatically move under the Open tab. If it's returned, it will move under the Returned tab. |
Returned | The Purchases > Returned tab contains all returned purchases.
From here, requesters and authorized people and roles can: Once the returned purchase has been submitted, it will automatically move under the Pending approval tab. |
Open | The Purchases > Open tab contains all active purchases in delivery.
From here, requesters can:
Except for the option to edit the purchase, authorized people and roles have the same options as the requesters. Additionally, they can return the purchase to the employee. |
All | The Purchases > All tab contains all purchases regardless of their above-mentioned statuses. |
Matching purchases with receipts and invoices before payment
Purchases for goods require a testimonial of delivery in the form of a Goods Received Note (GRN) - or receipt note. The supplier then sends an invoice to the buyer requesting payment for the delivered goods or services. The invoice is automatically linked to the purchase by extracting its number from the invoice through the Payhawk optical character recognition (OCR) feature. If the number of the purchase is not on the invoice, you have to add it manually by clicking on the Purchase order number drop-down menu and selecting the number.
As a result, a three-way matching accounting process is automatically performed by Payhawk, meaning that the system checks the quantity between the purchase and the receipt note, and then the net amount on the purchase and the supplier's invoice before the payment is executed.
Purchases that do not require a GRN (receipt note) trigger a two-way matching accounting process. The Payhawk system automatically checks the net amount on the purchase and the supplier's invoice.
Depending on the internal policy of your company, the organization may require receipt notes for purchases for both goods and services.
Useful resources