Purchase Order for multiple years

(0) Share

Report

Posted on by Anetta Amin

Hi D365 community!

I was wondering whether anyone has some experience in using the procurement module in Finance 365 in particular the Purchase Order functionality. Can a Purchase Order be setup for multiple years? (i.e. in line with the contract period). What are some of the implications for accounting posting and budget control?

Any insights would be much appreciated :)

I have the same question (0)

All responses (5)

Answers (1)

Suggested answer

Ramit Paul 22,797 Most Valuable Professional on at

Like (0)

Report

Are you saying PO should be valid only for desired years?

Was this reply helpful? Yes No
Suggested answer

Junaid Idrees on at

Like (2)

Report

Hi Anetta Amin,

In D365 Finance and Operations, we have Purchase agreement where you can define contract terms and financial controls. For example: You have a contract with vendor for 10,000 $ for an item or category fot 3 years. You can create multiple purchase orders from the agreement with specific Qty.

From Purchase agreement you can also see track how much has been consumed on purchase order and invoiced also.

Please find below Microsoft official doc for further understanding:

docs.microsoft.com/.../create-purchase-agreement

Was this reply helpful? Yes No
Verified answer

Ludwig Reinhard Microsoft Employee on at

Like (1)

Report

Hello Anetta Amin,

I don't see a problem per se by having a purchase order open for multiple years.

As long as you post partial product receipts and invoices in a timeline manner, a PO can be open for many years.

Yet, a purchase agreement might be the better choice in D365FO but this depends on your specific scenario.

What issue do you see?

What's the background of your question?

Best regards,

Ludwig

Was this reply helpful? Yes No
Anetta Amin 79 on at

Like (0)

Report

Hi Ramit, definitely not my intention to argue that point. At the moment our business raises an annual order and want to move away from that by raising potentially an order in line with the contract which could span for many years. thanks for your response :)

Was this reply helpful? Yes No
Anetta Amin 79 on at

Like (1)

Report

Hi Ludwig,

Thank you for your response. I definitely agree with you in that if we practice timely receipting and invoice matching, there should be no issues on the accounting side.

We are looking for ways to improve our PO process by aligning it to contracts and also our budget which is set annually. of course leveraging the system's capability as much as we can :)

Was this reply helpful? Yes No