Financial Management of Purchase Orders
Purchase Order (PO) Maintenance:
As part of the periodic financial reporting process, there is a semi-annual review of outstanding purchase orders in FIS. The review is intended to identify purchase orders:
- which are no longer required because:
- the items ordered are no longer required
- the vendor is unable to supply the ordered items
- where goods have been received, but no Invoice Receipt (IR) document has been processed; rather the supplier invoice has been paid by other means.
This same review should be an ongoing, frequent process at the departmental level, and is encouraged for the following reasons:
- Outstanding purchase orders are “reservations” against budget dollars and tie up departmental budgets. In the case where a goods receipt (GR) document has been processed, but the invoice has been paid using the “certified” method, budget dollars have been “used” twice for the same transaction: once for the PO reserve, and again for the payment of the certified invoice.
- There would be reduced instances of insufficient funds messages if commitments tied up in obsolete purchase orders are cancelled.
The following sections cover an overview of the accounting process and the periodic purchase order GR/IR variance clean up:
- Overview of Accounting Process for Purchase Orders This provides an overview of the purchase order process from an accounting perspective.
- Purchase Order GR IR Variance Clean Up memo This page provides a link to the most recent PO review memo to Business Officers and Financial Officers, which provides deadlines for the review and clean up of purchase orders, contact information and reference materials.
If you have any questions regarding the periodic clean up of the purchase order GR/IR variance, please email .
If you have any further questions regarding purchase orders in FIS, please contact your FAST team representative .