Purchasing

Purchasing starts with requisition creation & approval. Any person/department can request for material. Then Request for Quotations (RFQ) from suppliers. Suppliers then send Quotes to the buyer. Buyer verifies & approves quotes. After that buyer generates purchase order for procuring item/material.

Demand

Source

Purchase requisition

Request for quote (RFQ)

Supplier

Quotation

Order

Receive

Pay

Purchase order

Receipts

Payment

Purchasing Flow has been defined as below; Step 1: Define Purchased item Step 2: Create Purchase Requisition Step 3: Approve Purchase Requisition Step 4: Create RFQ from Requisition Step 5: Create Quotations Step 6: Approve Quotations Step 7: Create Purchase Order from requisition Step 8: Approve Purchase Order Step 9: Control of PO Documents

Step 1: Define Purchased item

Responsibility: Inventory > select organization > AGO Global Master

Enter the Item code & Description.

Apply the Purchasing Item template: Special > Copy from

> Apply > Done

Change the Item status from Issued to Production.

Save: Action > Save

Assign Organization to item: Special > Organization Assignment

Assign Item to organizations; ARC, AUS, CMP & IBS.

Save: Action > Save.

Step 2: Create Purchase Requisition

Responsibility: AMAT Purchasing Manager Navigation: Purchase requisition > Requisition

Enter the line details like, Item, quantity, need by date. Enter Organization & Location.

Enter the Distribution details by clicking on Distributions button. Enter Deliver-To Organizations.

Enter the charge account (or) it will be defaulted from the Organization parameters while saving the requisition.

Accrual Account & Variance account will get populated as per operating unit parameters.

Save: Action > Save

After saving Requisition number (1019720) gets populated. Approve button is enabled now.

Step 3: Approve Purchase Requisition

Responsibility: AMAT Purchasing Manager Navigation: Purchase Requisitions > Requisition Summary > Enter Requisition Number > Find

Summary window will show requisition status as Incomplete.

Click Approve button for approving / submitting requisition for approval.

> click OK to submit requisition for approval.

Note window will get populated as Document has been submitted for Approval.

Re-query Requisition for checking Approval Status.

Summary window will show the approval status as Approved

You can see the Approval/ Action History from Special > View Action History

Action History window shows, Action, date & performed by name.

Step 4: Create RFQ from Requisition

Requisition for any item can be converted into Request for Quotation (RFQ). RFQ is send to Suppliers for requesting Quotations from them. Responsibility: AMAT Purchasing Manager Navigation > Purchase Orders > AutoCreate > Enter Requisition Number > Find

AutoCreate Document window will get open. You can create standard PO/ RFQ from requisition.

Select Action & Document Type to be created.

Select the Row by CTRL+ click, otherwise Note window will prompt as No records have been selected. Please select at least one record.

Click Ok and select line.

After CTRL+ click line gets selected and this will show different colour.

Click Automatic, so that Default settings will get defaulted in RFQ.

New Document window will get open. Click on create to create RFQ from requisition

Note window will populate as showing RFQ number Autocreate completed successfully. Auto-created 1 requisition lines onto document 24034.

RFQ window will get populated with all Header & line details as Requisition.

Enter the other header details as Due Date, Reply via & Description of RFQ.

Enter the Supplier Information in Supplier window.

Enter price breaks (Quantity, Price, discount %).

Save the RFQ; Action > Save

Check for Currency details by clicking on Currency Button.

Change the status of RFQ from In Process to Active and save

Re-query RFQ and check the status.

Step 5: Receive Quotations from Suppliers

Supplier sends response on RFQ to Buyer through Quotations. Buyer Enter the Quotation information in Quotations window. Navigation : RFQs and Quotes > Quotations.

Enter the Quotation for Supplier 1 with all Header and Line details.

Check Quotation terms.

Check currency information. You can change currency, rate type & rate date.

Enter the price break information for quotation from Supplier 1. Enter Quantity, Discount & Effectively Dates.

Save the Quotation price break information.

Change the status of Quote from In Process to Active.

Save: Action > Save

Similar Enter Quotation details for Supplier 2. Enter Header details

Check Quotation terms;

Enter Items details

Enter price break information (Quantity, Discount, Effectivity dates)

Save: Actions> Save

Change the status of quotation from In Process to Active.

Step 6: Analyze and Approve Quotations

Quotations from supplier analyzed from Quote Analysis menu. Query for the RFQ number in Quote analysis menu. Responsibility: AMAT Purchasing Manager Navigation: RFQs and Quotes > Quote Analysis

Analyze Quotations window will show all available Quotations for particular RFQ.

You can approve entire quotation or line within Quotation.

Approve one of line with Quotation by giving reason & effectivity dates. Save the approved/analyzed quotation.

Step 7: Create Purchase Order from requisition

Standard Purchase order can be prepared from approved requisition by using autocreate functionality. Note: We can create Purchase Order from Approved Quotation also Responsibility: AMAT Purchasing Manager Navigation: Purchase Orders > AutoCreate

AutoCreate Document window will show approved requisition line details

Select the line by CTRL+click

Select Action & Document Type. Click on Automatic Button, the default parameters will get populate before creating PO.

Click Create to create the PO. It will show Note message as with Document number.

Purchase Order will get created with Incomplete status.

Enter the supplier and ship to location details in auto-created purchase order.

Save: Action > Save

Step 8: Approve Purchase Order

Responsibility: AMAT purchasing manager Navigation: Purchase Orders > Purchase Order Summary > Enter Purchase Order number > Find

Click Approve button for approving the purchase order.

Another Approve Document window will get open. Click ok to submit document for approval.

Note window populates as Document has been submitted for approval.

Re-query the purchase order to see the Approval Status. Check from Special > View Action History

Action window will show the details of Action, Date & Performed by. Below window shows, Thangam has forwarded the Document (PO) for approval to Govindraj. And the Standard Purchase Order 16008024 is pending for action from Govindraj.

Use / Ask Govindrajs login(X047292) to approve this PO through notifications summary, from which the PO sought next level approval. Responsibility: AMAT purchasing manager > Check the Notification Summary. Notification Summary window shows the Open notifications which are pending for action. Open notification of Standard Purchase order 16008024 is visible in notification summary.

You can Delegate or Respond to the Document.

For Respond: click on respond button. Put Approval action like Approve, forward , reject, approve and forward by selecting it from LOV.

After responding the notification gets closed. You can only view the response of document. You cannot respond/delegate against this document

Re-query the Purchase order # 16008024, to check the Approval status. Below document summary window is showing, document has been approved.

Step: 9 Document Control

By Using Document control functionality purchasing Manager/Superuser can HOLD, Freeze, Cancel, and Hold for Invoice the document. Below example shows, document control when Po is in Incomplete status & Approved status 1. Document Controls when PO which is in Incomplete Status (before approval): Below example shows the Control of PO document when it is in Incomplete status. Responsibility: AMAT Purchasing Manager. Navigation: Purchase Orders > Purchase Order summary> Query for existing open purchase order (which is not approved)

PO # 16073723 is in Incomplete status.

You can control this document from; Special > Control

Control Document window will appear showing Actions for Control.

Below example we kept PO on Hold ; Action > On Hold > ok

Re-query the Purchase order. It will show the status as Incomplete, On Hold.

Try to approve the document: It will submit for approval.

But if you Query action history, it will through error as document is in Incomplete status or unavailable to you.

In such case, go and check the Control window; Navigation: Special > Control

Control window will show the Action details.

Click on action > Ok Note window will populate showing Control Action is completed successfully.

Status of PO will change to Incomplete

The PO can be approved by submitting for approval.

The status of PO gets change to Approved.

2. Control of Approved PO Document. The Approved PO shows many controls Navigation: Special >Control

The Control Document window shows Actions as Cancel PO, Close, Finally Close, Freeze, On Hold & Open for Invoice.

The below example shows PO # 16073723 is under Freeze control. Navigation: Special > Control > Freeze > ok

Note window will appear showing Control Action is completed successfully.

Freeze PO , you cannot Open & cant take any action.

Check control & remove/change control of Po Document.

Unfreeze the PO document

Note window will appear as Control Action is completed successfully.

You can Open PO Document # 16073723, as now it is not in freeze condition.

Below example we will try to receive the Approved PO which is on Hold: Query for the approved PO. Navigation: Purchase Order Summary > Purchase Orders > Special > Control > Select the Action for control > ok

After completion of Oh hold action, note window populates as Control Action completed successfully.

At any stage when we put approved PO Document on hold, the status will get change to Requires Reapproval

You cant receive this PO as it requires re-approval. Release the Hold from Special > Control for the Po Document.

After completion of Control Action note window gets populated as Control Action is completed successfully.

Approve the PO & receive.

After the material receipt, the status of PO will be changed to Approved Closed.

For Approved, Closed Document, below controls are available. You can Finally Close, Freeze, On Hold, Open, Open for Invoice & open for Receiving.