As part of our year end processes and drive for continuous improvement to our Finance and Reporting systems, we have undertaken some work to cleanse our Purchase Ledger of historic records.
This means that all open purchase orders and requisitions with a delivery date of up to 1 March 2020 have been closed. The data cleanse has resulted in the closure of over 12,000 purchase orders (POs) and 200 requisitions.
With the financial pressures caused by COVID-19, this data cleanse means that that we are in a better position to understand upcoming payments and commitments and aids our cash flow management during this time.
This process will now become a monthly exercise in line with the following criteria:
- All requisitions which have not been approved will be closed after six weeks from the date of being raised
- All purchase orders which have an order date of over one year old will be closed
- All purchase orders will be closed six weeks after the delivery date has passed.
**To prevent your PO’s being closed prior to the work being complete and invoiced you must ensure that the Delivery Date entered on the requisition in Unit4 is the date the work or service will finish or the goods will be delivered and invoiced. SMT are reviewing PO’s for closure on a monthly basis and you will need to correct all old PO’s to allow they to remain on the system **
Purchase order guidance
- Delivery date – The date entered into the requisition must reflect the date that the work or services being delivered will end or the date the goods will be delivered by. This is especially important if you are raising a rolling or contract P.O. which you intend to use over multiple months. For example a contract for services which has been awarded for 12 months from the 1 April 2020 would have a delivery date of 31 March 2021 entered on the requisition in Unit 4.
- One year maximum – A purchase order must only be raised for a maximum time period of one year. If your contract is for longer than a year, please raise a new Purchase Order for each year of the Contract.
- Detailed description – The description of goods and services must be detailed enough for Finance and Procurement team to understand the goods and services which are being delivered and the timeframe in which the delivery will take place.
- Retrospective orders – Requisitions must be raised and approved in Unit4 prior to any work being undertaken by Suppliers. This is especially important in the current financial climate. Retrospective Purchase Orders are not permitted under GC policies.
- Timely invoicing by suppliers – Contract managers must ensure that suppliers invoice in a timely manner for the work delivered.
How to guides
We’ve created six quick videos as well as documents below to give you step-by-step instructions on finance processes:
- How do I raise a requisition for single and rolling POs?
- How do I check the PO workflow to see who needs to approve the requisition?
- How do I check the invoice workflow to see who it is awaiting approval from?
- How do I check the status of an invoice and whether it has been paid?
- How do I run the PO report to find out the status of my PO and how much money is left on it?
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If you have any questions about the above, please contact Kelly Edwards or Lindsay Smith.