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Finance template

Purchase order approval process with approval limits and PDF

Small purchases go straight through, larger ones need the manager, and the biggest go to the board. The purchase order PDF is issued at the end.

2 steps 11 fields Approval limits by amountGenerates a PDFSignature
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A purchase order is the moment a company commits money to a supplier, so it is also where weak controls show up first. When every PO goes to the same person, that person becomes the bottleneck. When none of them need approval, the first time anyone looks closely at a large order is when the invoice arrives.

This template lets the order total decide who approves. The requester enters the supplier, cost center, needed-by date, the reason and the items, and the form calculates the total line by line. Orders up to $1,000 go straight to purchasing. From $1,000 to $10,000 the requester’s manager approves, and above $10,000 two approvals are required, for example from two directors. If someone edits the items and the total changes, the approvers are worked out again. Purchasing then sets the payment terms, such as Net 30, confirms the expected delivery date and signs. Completing that step issues the purchase order PDF with the items table, the terms, signature lines and a verification code anyone can check.

It fits companies that have written down their approval limits, or are about to, and want a clean PO to send suppliers without running an ERP.

How it runs, step by step

The process reads from top to bottom. Each step goes to its owner with a deadline, and everything that happens is recorded in the request's timeline.

  1. Request

    Whoever starts the request

    Add the items and the supplier. The total decides who approves.

    Approval depends on “Order total”

    Up to $1,000No approval needed
    $1,000 to $10,000The requester’s manager
    Above $10,000Approvers you choose (2 approvals)
    8 fields in the request form
    • Supplier * Text
    • Supplier EIN Text
    • Cost center *Administration, Operations, Sales, IT Choice
    • Needed by Date
    • Items *Columns: Description, Quantity, Unit price, Total Table
    • Order total Calculated
    • Why is this needed? * Long text
    • Quotes Files

  2. Purchasing

    A person or team you choose

    Place the order with the supplier. The purchase order PDF is generated when you complete this step.

    Due in 3 days (business time) Issues: Purchase order
    3 fields
    • Payment terms *Due on receipt, Net 30, Net 30/60, Net 45 Choice
    • Expected delivery * Date
    • Buyer * Signature

Make it yours

Match the tiers to your policy

Edit the ranges and approvers in the approval limits: add a tier, change $10,000 to your own number, or send the top tier to specific people such as the CFO and CEO.

Keep vendors in a list

Replace the Supplier text field with a user-defined list of approved vendors, so buyers pick names instead of typing them slightly differently each time.

Put your brand on the PDF

Open the Purchase order document template to add your logo, delivery address and standard terms. Every PO issued afterwards uses the new layout.

Add a receiving step

If you want proof that goods arrived before anyone pays, add a step after Purchasing where the requester confirms delivery and attaches the packing slip.

Frequently asked questions

What is a purchase order approval process?

It is the set of rules that decides who must approve a purchase order before it goes to a supplier. Most companies tie it to the amount: small orders need no approval or just a manager, larger ones need a director or finance, and the largest need two people. The approval should happen before the order is placed, not when the invoice shows up.

What are typical purchase order approval limits?

There is no standard, and the right numbers depend on your size and margins. A simple shape is three tiers, like this template: no approval for small amounts, the manager for the middle range, and two senior approvers above a high threshold. Review the limits when the company grows or spending patterns change.

What should a purchase order include?

A PO number, the buyer and the supplier, the items with quantities and unit prices, the total, payment terms, the expected delivery date and an authorized signature. Asking suppliers to quote the PO number on their invoice makes matching invoices much easier later.

What does Net 30 mean on a purchase order?

Net 30 means the invoice is due 30 days after it is issued, and Net 45 gives 45 days. Due on receipt means the invoice should be paid as soon as it arrives. Agree on the terms before ordering and put them on the PO so the invoice cannot surprise you.

Guides on this process

More finance templates

Purchase request

Ask for something to be bought, get it approved and track the order until it arrives.

Request → Director approval → Place the order → Confirm delivery

Travel advance and expense report

Ask for an advance before the trip; after the return date the traveler reports the expenses and finance settles the difference.

Request → Advance payment → Trip → Expense report → Settlement

Customer credit limit

Sales asks for a credit limit, finance analyzes it and the approver depends on the amount.

Request → Credit analysis → Registration

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