A purchase order records what you are ordering from a supplier, at what price, before the goods or services arrive. You email it to the supplier as a confirmation of the order, and once you have received what you ordered, you can convert it straight into an expense so it flows through your reporting.
The purchase order lifecycle
A purchase order moves through a fixed set of statuses:
- Draft:created but not yet sent. Fully editable, and does not have a number yet
- Sent:emailed to the supplier. The supplier's details are frozen at this point, and the purchase order can no longer be edited
- Fulfilled:the goods or services have been received. From here you can record it as an expense
- Cancelled:a sent purchase order that you no longer want to go ahead with
Purchase order numbering
Draft purchase orders do not have a number, so a purchase order you create and abandon never leaves a gap in your sequence. A number in the form PO-0001 is assigned the first time you send it. All purchase orders share a single account-wide counter, unlike invoices, which use a separate sequence per client prefix.
A supplier is required
You need at least one supplier before you can create a purchase order. Add one from the Suppliers tab, or directly from the purchase order form.