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Sineserton
Sineserton ,
Category: Finance
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What is the best business practices for a Purchase Order threshold

Customer Question

What is the best business practices for a Purchase Order threshold and why?
Submitted: 2 years ago.
Category: Finance
Expert:  Sineserton replied 2 years ago.

Khristopher N. Sines AACJ :

Good evening and welcome to JustAnswer.com

Increasing the thresholds to more accurately reflect the cost of projects will enable departments to operate more efficiently and with greater flexibility.

Khristopher N. Sines AACJ :

When should purchase orders be used?
Due to the administrative cost of preparing and handling
the purchase order document, purchase orders for less than $3,000 should be used only when the
commodity, conditions, or amount of the procurement precludes use of a simpler award method.

Khristopher N. Sines AACJ :

Purchase orders give a financial auditor more of a paper trail in testing
the status of the internal control (or lack of it) in your organization. If
you are subject to having financial audits performed, purchase orders may be
essential. They require that some level of management approves all
purchases for the company by signing off on them.

Khristopher N. Sines AACJ :

Here is a link to help understand why purchase orders are important!
http://www.brightpearl.com/sites/default/files/14-reasons-why-placing-purchase-orders-is-so-important.pdf

Khristopher N. Sines AACJ :

Please feel free to ask more questions until you are satisfied with the answer! God Bless!

Expert:  Sineserton replied 2 years ago.
Thank you for allowing me to help you in your time of need. Please do not hesitate to contact me in the future for any information you may be needing. God bless!