Purchase Order (PO)

A purchase order is the formal, trackable document a buyer sends to a supplier once an internal purchase requisition has been approved — specifying what's being bought, at what price, quantity, and terms.

The purchase order becomes the reference point for the rest of the transaction: goods or services received are checked against it, and the supplier's invoice is matched against it before payment is approved.

A purchase order typically lists the supplier, items and quantities, agreed prices, delivery terms, and payment terms. It becomes the reference document for receiving goods and for checking the invoice.

If terms change after issue, an amendment or revision should be recorded rather than the original silently edited, so the audit trail stays intact.