What is Purchase Requisition?
Purchase Requisition is one type of “Form” which is used by the user department to request for the material. Through this document the user department notifies the procurement department to procure raw materials for the production, to procure office stationery for office work, and other materials for the several departments.
Purchase Requisition should be pre-numbered and to be triplicate in form and these three copies should be in separate color. One Copy should be retained to the user department, one copy should be retained to purchase department for their further process and one copy should be retained with the requisition books.
A Purchase requisition should be signed and verified by the head user department and to be approved by the concerned authority otherwise excessive goods to be procured or goods could be procured for using personal use.
However, the purchase requisition could be received from-
- Store Keeper where standards level of material is maintained.
- Production Control Department
- Plant Engineer
- departmental head for small supplies, office sundries etc.
- Other users department
Steps of Purchase Requisition Process
Purchase requisition is the internal document using to procure the required materials. Purchase Requisition doesn’t have any specific format, organizations design it considering their own system. However, following are the steps commonly maintain as the process of purchase requisition:
Step -01: User Department initiates the purchase requisition and forwards the requisition to the Inventory Department. Inventory department cheque the balance of respective materials and forward the requisition to the purchasing department. In this respect, the user department may request manually filling the prescribed form of the organization. Some organization using computer software Purchase requisition. Computer software requisition is considered as the safest way of requesting the purchase because it reduces the chances of procuring unnecessary materials and prevent the fraud of the organization.
Step-02: After getting purchase requisition, the Purchase Department verify the information used in the purchase requisition. Purchase Office confirm whether the requisition is properly signed by the concerned authority. If everything seems to be correct by the purchasing department, they may generate a purchase order.
However, this is all about the process of Purchase requisition.
Importance of Purchase Requisition
The importance of Purchase Requisition can be enumerated are as follows:
- It initiates the procurement process and makes easier the purchasing
- Protect the organization from the production disruption
- Minimizes the chance of fraud.
- Considered as a permanent document and could use as a price comparison
- Purchase Requisition minimizes the chances of misuse of the materials.
Before making any requisition for the purchase of materials two important points should be taken into consideration:
- Stock Position as shown by the stock records
- Production Programme in force in the factory
The requisition form contains two dates i.e. date of issuing the requisition and the date by which the the material is required.
If the purchase is of regular nature, then the storekeeper prepares the purchase requisition specifying the date by which the material is required, considering the rate of consumption and the minimum level fixed for this.
If the purchase is for specific material, specific purchase requisition is prepared by the production department or the planning department.