Ledgr/Documentation/Procurement

Procurement

Watch the lesson: Raise a purchase order and receive the goods (2:07).

Everything between "we need this" and "the invoice is right, pay it" — asked for, approved, quoted, ordered, received and matched, with a record at each step of who decided what.

Purchase requests

A purchase request — a requisition — is somebody asking to spend money. It is deliberately not a purchase order: the person who knows a part is needed is rarely the person allowed to commit the company to buying it.

1. Procurement → Purchase requests → New request
2. Add what you need and why

   Lines can be stock items or free text for things you do not hold. The reason field is what an approver reads first, so it earns its place.

3. Submit

   The approval rules decide where it goes. A request raised from an MRP recommendation arrives with its lines already filled in.

Approvals

Rules route a request by value, so R500 of consumables does not need the same signature as R500 000 of steel. The Approvals tab shows a count of what is waiting on you specifically, and each decision is recorded with who made it and when.

Add the bands under Policy → Approval routing → Add a band. Until you do, every submitted request waits for one approval from anybody who holds the approve permission for procurement — having no rules does not mean anything goes. The only ways a request goes through with nobody's approval are the ones you set: an Auto-approve below amount under Policy, or bands that start above the request's value.

Sourcing and RFQs

1. Raise an RFQ from an approved request

   Pick the suppliers to ask. Each gets the same lines, so the replies are comparable.

2. Capture the responses

   Price, lead time and validity per supplier per line.

3. Award

   Awarding turns the chosen quote into a purchase order. The RFQ stays attached, so a year later you can still show what the alternatives were — which is exactly what an auditor or a B-BBEE verification asks for.

Approved suppliers

The Approved suppliers tab is the list you are allowed to buy from, as distinct from every supplier who has ever sent an invoice. Each carries the things an SA buyer actually needs at the moment of choosing:

• B-BBEE level and status, so preferential procurement is a fact at the point of the decision rather than something reconstructed at scorecard time.
• VAT number and tax clearance, so you find out a vendor is not compliant before you owe them money rather than when you try to claim the input VAT.
• Performance — on-time and late deliveries, counted from receipts rather than typed in.

Contracts

Agreed prices and terms with a supplier over a period. A purchase order raised against a contract prices itself from it, and the contract's remaining value is drawn down as you buy, so an over-commitment is visible while it is still avoidable.

Receiving

A goods receipt records what actually arrived, which is regularly not what was ordered. Receive short, receive over, or receive against several deliveries — the purchase order tracks the outstanding balance either way, and the stock movement happens at receipt, not at invoice.

Three-way match

The check that stops the most expensive routine mistake in accounts payable: paying an invoice for goods that never arrived, or at a price nobody agreed to.

Ledgr compares the purchase order (what was agreed), the goods receipt (what arrived) and the supplier invoice (what is being charged). Where the three agree within tolerance the bill is passed for payment. Where they do not, it becomes an exception with the difference named — quantity, price, or something billed that was never received — and the 3-Way Match tab carries the count so exceptions are worked rather than accumulated.

An exception holds the bill's payment. Paying it from Expenses, marking it paid, a bank rule and a bank match are all refused, saying why, until somebody who can approve purchases Accepts the variance on the 3-Way Match tab — or Rejects it, which keeps it unpaid while you take it up with the supplier. Under Policy you can make the match advisory instead: exceptions are still listed and counted, and nothing is held.

Purchase orders

Issuing the order is what turns a sourcing decision into a commitment. The Orders tab holds them with what has been received against each, so the open commitment is a figure you can see rather than one somebody adds up. Suppliers can acknowledge an order in their own portal, which is the difference between an order sent and an order accepted.

Every business needs some of this, so the plain version — orders, receiving and linking a supplier's invoice to its order — is also on Expenses from Starter. What Procurement adds is everything in front of it — purchase requests, approval routing, RFQs, approved suppliers and contracts — and the 3-Way Match tab where exceptions are worked; a payment is held only where that tab exists to release it.

Landed cost

What an imported item actually costs is not what the invoice from the supplier says. Freight, clearing, duty, insurance and port charges are all part of it, and they arrive on separate invoices from separate parties, usually weeks apart.

The Landed Cost tab lets you attach those charges to the shipment and apportion them across its lines — by value, by quantity or by weight — so the cost that ends up on the stock item is the cost of getting it onto your shelf. Weight is each product's Weight per unit (kg) from its product card, times the units received; if a stock-tracked product on the shipment has no weight, posting is refused and the product is named. Get this wrong and every margin on those items is overstated, which is a pricing error rather than a bookkeeping one.

B-BBEE recognised spend

Preferential procurement is points on your scorecard, and it is measured on what you actually spent with whom. The B-BBEE Spend tab totals your spend against each supplier's level and B-BBEE status, and shows the recognised percentage that follows from it.

The figures behind it come from the supplier's own certificate or affidavit, uploaded through the portal — and a level a supplier claims for themselves is held as a claim until somebody with approval rights accepts the document. That order matters: it is the buyer who gets the audit finding for spend claimed on a certificate nobody checked.

The supplier portal

Your suppliers get a workspace of their own, at no charge to them or to you. It is more than a mailbox: much of it is for things they do on their own initiative, not only when you ask. What they send arrives on the From suppliers tab.

What they cannot do is write in your books. A despatch advice is a declaration before anybody has counted anything; a submitted invoice is reported to them as awaiting acceptance, never as a debt you have agreed.

Policy

The Policy tab holds the price and over-receipt tolerances, the auto-approve amount, the minimum number of quotes before an award, default payment terms, whether every purchase order needs an approved request behind it, how strictly a three-way-match exception holds a payment, and the approval bands — who approves at each amount. A supplier's lead time is set on the supplier's line under Approved suppliers, not here.

Common problems