A purchase order (PO) is a buyer-issued record describing a proposed purchase: the supplier, items, quantities, units, prices, delivery requirements and applicable terms. Its reference helps connect supplier acceptance, later changes, receipts and invoices.
A PO is useful when several people need a shared record of what was requested and agreed. It is not proof that goods shipped, arrived or were approved for payment.
Purchase order versus invoice and sales order
| Record | Usually created by | Main purpose |
|---|---|---|
| Purchase order | Buyer | Specify the proposed purchase and retain the authorized commitment |
| Sales order | Supplier | Record the customer's order in the supplier's process |
| Packing slip | Supplier | Describe the contents of a shipment |
| Goods received note | Receiving team | Record the actual delivery and exceptions |
| Invoice | Supplier | Request payment under the agreed terms |
Keep the references linked, but do not assume the documents have identical quantities or dates. A supplier may accept only part of a PO. An invoice may cover a deposit, one delivery or several deliveries. Invoice timing does not establish physical receipt.