OverviewPurchase Order Authorization is a programmatic method that allows for three-way matching in order to prevent errors in paying vendors for service-type items (and optionally, for indirect material type items) and to ensure that the exact nature of the item, quantity and price match on all three documents (purchase order, receiving record and vendor invoice).
The PO Authorization program accomplishes the following:
- The ‘Authorization for Payment' of Service-type Purchase Order Lines.
- The 'Receipt and Authorization' of Indirect Material-type Purchase Order Lines, if the option on the PO Control Record is set to do so. Otherwise, Indirect Material-type Purchase Order Lines are handled as normal Purchase Order receipts, using the PO Receipts process.
- Provides for several selection options for the retrieval of all Purchase Order Lines that have not been previously 'authorized' (where the Vendor has been notified and the PO has not been fully 'authorized'):
- by 'Authorization ID', where the Authorized ID set on the PO Line matches the Authorized ID on the Manufacturing User ID record of the current User, or
- by 'Buyer', where the current User's ID matches the ID set on the PO Header as the Buyer, or
- by 'Executive Authorization ID', where the current Users' Executive Authorization ID matches that set on the requesting Organizational Department defined on the PO Header.
- Provides the ability to 'Authorize' using a password-protected Authorizing ID or Executive Authorizing ID, to ensure that only assigned staff member can perform 'PO Authorizations'.
- Once a PO Line Item is fully 'Authorized', it is no longer made available for further 'Authorization' unless reversed.
- PO Lines for Direct Material, Subcontract or Outside Operations, (which are received through the 'PO Item Receipts function'), are never made available for PO Authorizations.
- Provides a means of processing reversals of 'Authorizations', (and reversals of Indirect Material receipts, whether the receipts were processed using PO Receipts or PO Authorizations), using a 'Reversal Option' checkbox on the same Page Layout, as well as providing the ability to add User Comments on the reversal record.
NOTE Once a PO Line has been 'Authorized' or ‘Received’, and 'Matched' to a Vendors' Invoice using the PO-AP Match process, it cannot be reversed.
- Provides a comprehensive transaction audit trail. The User is provided visibility of past 'Authorizations' on a PO Line by hovering over the 'View' hyperlink under the column entitled 'Authorization Detail’.
Setup
Step 1 - Determine if the 'Receipt and Authorization' of indirect material will be performed using the 'PO Item Receipt' or 'PO Authorization' function within a division.
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PO Control Record
This selection is set on the PO Control Record for each division, using the field entitled 'Indirect Material Authorization Indicator)' via a drop-down menu with pre-defined values.
Step 2 - Define and create the appropriate 'Authorizing ID's' (both Staff and Executive-level) by Division, along with a password.
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Authorizers
Authorizing ID's are created in System Setup using the 'Authorizers' program.
Step 3 - Assign the appropriate 'Executive Authorizing ID' to the Organizational Department of each Division. Also, assign the appropriate 'Authorizing ID' to the Organizational Department of each Division for both the 'Service Authorization ID' and 'Indirect Material Authorization ID'.Navigation
Organizational Depts
- Executive Authorizing ID is assigned in 'Organizational Department' program on the sub-tab entitled 'General Purchasing Approvals'.
- Authorizing ID's are assigned in 'Organizational Department' program on the sub-tab entitled 'Purchase Order Authorizations' for the ' Service Authorization ID' and Indirect Material Authorization ID'.
Step 4 - Assign the 'Authorizing ID's' (both Staff and Executive-level) to the appropriate users using the ‘Manufacturing Users’ program, tab entitled ‘Approvals’.
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Manufacturing Uses
Authorizing ID's are assigned to users in System Setup using the 'Manufacturing Users' program on the sub-tab entitled 'Approvals'. If the Super Authorizer box is checked, this Manufacturing User is able to Authorize PO’s across all divisions for all Authorization ID’s.
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