Link Purchase agreement to PO vendor invoice in Pending vendor invoice form

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Posted on by Huong Pham

Hi guys,

I want to link a Purchase agreement to vendor invoice. I find that there is a field in Pending vendor invoice form but this have no value in this.

Is there any conditions in Purchase agreement that i have to set up? Please give me some advise.

Thanks,

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Danny Bilodeau 4,687 Super User 2025 Season 2 on at

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RE: Link Purchase agreement to PO vendor invoice in Pending vendor invoice form

Hello Huongpm,

The Purchase Agreement Classification needs to have teh option <Direct Invoicing> enabled.

Purchase Agreement with a Direct Invoicing Agreement classification will not be available to be released as PO; you will only be able to invoice them using the Vendor invoice using the field you are highlighting.

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Huong Pham 90 on at

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RE: Link Purchase agreement to PO vendor invoice in Pending vendor invoice form

Hi Danny,

I enable <Direct invoicing> and then i can choose Purchase agreement in that field. But the system display an error. Could you explain more about that.

Thanks so much,

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Danny Bilodeau 4,687 Super User 2025 Season 2 on at

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RE: Link Purchase agreement to PO vendor invoice in Pending vendor invoice form

Hello huongpm,

To clarify what I said for "Require Direct Invoicing", a constraint for a PA with a Purchase Agreement Classification is that it cannot be used to release PO. That means that you will not be able to use Direct Invoicing PA to create POs. You will only be able to use them for Vendor Invoices. So they are useful for non-stock items or purchases using categories for which you will likely not have a PO (utilities company, online retailers (?), etc) with whom you have contracts on which you want to exercise some control (amount, enforce maximum, time period,...); the PA can also drive the Financial Dimensions.

For other purchases for which you have a PO (and want a PO), you will use a PA with a classification that is not Direct Invoicing. The PO has to be first created referencing the PA. So you create the PO header linked to the PA and new lines can be added that will draw from the PA agreement (or not if the item/category is not on the PA or if you remove the association to the PA on the PO Line). If PO is linked to a PA, the PA field will appear on the Invoice header when you generate the invoice..

If the association does not exist, it can't be done on the Vendor Invoice. Here is an invoice for PO for same Vendor & item as above that was not created referencing the PA.

Hope that helps!

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Huong Pham 90 on at

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RE: Link Purchase agreement to PO vendor invoice in Pending vendor invoice form

Hi Danny,

Thanks for your explanation.

So as you said, if i create PO via Purchase requisition then I can't associate PO and Purchase agreement?

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Danny Bilodeau 4,687 Super User 2025 Season 2 on at

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RE: Link Purchase agreement to PO vendor invoice in Pending vendor invoice form

Hello huongpm,

I did not say anything about Purchase Agreement not being applicable to Purchase Requisitions; that would not be true.

In fact, if you create a Purchase Requisition for an item or category that is covered by a Purchase Agreement, the system will select the vendor with a Purchase Agreement. If you look at the Purchase Requisition Line Details, you will see that reference to the Purchase Agreement. That link will be lost if you change the vendor for another with who you do not have a Purchase Agreement.

So the link to a PA can be created early in the process, Purchase Requisition line or Purchase Order header but not when generating an invoice.

Regards,

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Huong Pham 90 on at

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RE: Link Purchase agreement to PO vendor invoice in Pending vendor invoice form

Hi Danny,

Sorry about my unclear question. I mean when i create PO from Purchase Requisition (not link to the Purchase Agreement before) so that i can't link Purchase Agreement with the PO header? Because Purchase agreement can only link to PO header when you create directly PO in Create purchase order pop-up form.

Thanks,

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Danny Bilodeau 4,687 Super User 2025 Season 2 on at

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RE: Link Purchase agreement to PO vendor invoice in Pending vendor invoice form

Hello huongpm,

Here is the documentation on Purchase Agreement. Please have a look at the topic "Applying purchase agreement in the ordering process"

docs.microsoft.com/.../purchase-agreements

If a requester initiates a purchase event from a Purchase Requisition (PR) for an item that it covered by a Purchase Agreement (PA), the system will recognise it and select the Vendor and the PA. Before the PR is approved, a buyer can change the PA or the vendor on the PR.;If there is a PA, it will be visible on the PR Line details.

After the PO is created, the PA only be visible if you click as General > Purchase Agreement in the top ribbon. If there is no existing link to a PA, you wont be able to create it after PO is created. If there is a Purchase Agreement listed, then you can link the PO Line using the menu Update Line > Purchase Agreement > Create link.

Regards,

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Huong Pham 90 on at

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RE: Link Purchase agreement to PO vendor invoice in Pending vendor invoice form

Hi Danny,

Thank you so much. I will check and test again.

But i really don't understand why D365 don't allow to link the PO invoice and the PA in invoice step.

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Danny Bilodeau 4,687 Super User 2025 Season 2 on at

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RE: Link Purchase agreement to PO vendor invoice in Pending vendor invoice form

Hello huongpm,

I can't explain the reasoning either. An educated guess is because the PA controls are applied at the time of the PO creation (max. enforced) and linking a PA to an invoice would risk bypassing that control. Or that a buyer might decide for other reason not to use a PA (which comes with its own Delivery Terms, etc) and therefore the responsibility is with Purchasing and not Accounts Payable. Just guesses.

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