The short answer
A purchase requisition (often shortened to PR or requisition, and also called a purchase request) is an internal document an employee submits to ask for goods or services. It says what is needed, why, roughly how much it costs and which budget pays. It goes to approvers. It is never sent to a supplier.
A purchase order (PO) is the document the company sends to a supplier once the purchase is approved. It says exactly what is ordered, at what price, delivered where and when, and on what payment terms. Once the supplier accepts it, it commits both sides.
- The requisition asks. The PO orders.
- The requisition is read by approvers and finance. The PO is read by the supplier.
- The requisition can be rejected or changed at no cost. The PO, once accepted, is a commitment.
- A requisition does not affect the budget beyond a soft hold. A PO counts as a commitment against the budget.
Purchase requisition vs purchase order, side by side
| Aspect | Purchase requisition | Purchase order |
|---|---|---|
| Created by | Any employee who needs something | A buyer, or generated from the approved requisition |
| Audience | Approvers and finance, internal only | The supplier |
| Timing | Before approval | After approval |
| Purpose | Ask permission to spend | Order from a supplier on agreed terms |
| Price | Estimate, possibly with a quote attached | Agreed price |
| Supplier | Suggested, sometimes unknown | Confirmed |
| Legal effect | None outside the company | Commercial commitment once accepted |
| Budget effect | Pending, often shown as a soft hold | Commitment against the budget |
| Used later for | Audit trail of who asked and who approved | Three way matching against receipt and invoice |
- Created by
- Purchase requisitionAny employee who needs somethingPurchase orderA buyer, or generated from the approved requisition
- Audience
- Purchase requisitionApprovers and finance, internal onlyPurchase orderThe supplier
- Timing
- Purchase requisitionBefore approvalPurchase orderAfter approval
- Purpose
- Purchase requisitionAsk permission to spendPurchase orderOrder from a supplier on agreed terms
- Price
- Purchase requisitionEstimate, possibly with a quote attachedPurchase orderAgreed price
- Supplier
- Purchase requisitionSuggested, sometimes unknownPurchase orderConfirmed
- Legal effect
- Purchase requisitionNone outside the companyPurchase orderCommercial commitment once accepted
- Budget effect
- Purchase requisitionPending, often shown as a soft holdPurchase orderCommitment against the budget
- Used later for
- Purchase requisitionAudit trail of who asked and who approvedPurchase orderThree way matching against receipt and invoice
What belongs on a purchase requisition
A requisition should give an approver everything needed to say yes or no without a follow-up email. The fields that do the most work:
- Item or service, with quantity. Specific enough that a buyer could order it.
- Estimated cost. With a quote attached for anything above a set amount.
- Suggested supplier. Or a note that the buyer should find one.
- Department, project and GL account. So the right budget owner approves and the budget updates.
- Needed-by date. So the buyer knows the urgency.
- Business reason. One or two sentences, required above a threshold or for unusual categories.
The requisition is also the natural place to check the budget. When the requester sees that the marketing budget has $6,400 left for the quarter and the request is for $5,900, both requester and approver know where they stand before anything is committed.
What belongs on a purchase order
The PO takes the approved requisition and adds what the supplier needs to fulfill it:
- A unique PO number, which the supplier quotes on the invoice.
- The supplier's legal name and address, from the supplier record.
- Line items with confirmed quantities, units and agreed unit prices.
- Delivery address, delivery date and shipping terms.
- Payment terms, such as net 30.
- Your standard terms and conditions, or a reference to a master agreement.
What does not go on the PO: the internal justification, the approval chain, the budget balance. Those stay on the requisition, where they belong.
How a requisition becomes a purchase order
In a well-run process, the PO is generated from the approved requisition rather than typed from scratch. A worked example:
- Monday 9:10. A marketing manager raises a requisition for 5,000 printed brochures for a trade show, estimated at $3,850 from a printer the team has used before, coded to the events budget, needed in three weeks. The quote is attached.
- Monday 9:12. The requisition routes to the head of marketing (amount between $1,000 and $10,000). The request shows $11,200 left in the events budget.
- Monday 11:40. The head of marketing approves from a Slack message.
- Monday 13:05. The office manager, acting as buyer, confirms the price with the printer, which now quotes $3,790, and converts the requisition into PO 2231 for $3,790 with net 30 terms. The PO is emailed to the printer as a PDF.
- Result. The events budget shows a $3,790 commitment. The requisition, the approval and the PO are linked, so anyone can trace the purchase from request to order, and later to receipt and invoice.
Notice that the price dropped between the requisition and the PO. That is fine and common. If it had gone up by more than a set margin, for instance 10 percent, the PO would route back for approval.
When one does not equal one
The relationship is not always one requisition to one PO:
- One requisition, several POs. A requisition to equip a new office with desks, chairs and monitors may become three POs to three suppliers.
- Several requisitions, one PO. Five departments each request printer toner in the same week, and the buyer combines them into one PO to the preferred supplier for a better price.
- Requisition against a blanket PO. For recurring supplies with an agreed price and cap, each requisition becomes a release against the existing blanket PO instead of a new order.
Good software keeps these links, so each line on a PO knows which requisition and which budget it came from.
Which purchases need a requisition, a PO, both or neither
| Purchase | Requisition | Purchase order | Why |
|---|---|---|---|
| Equipment, inventory, larger supplies | Yes | Yes | Needs approval, agreed price and receipt for matching |
| Services with a defined scope | Yes | Yes | Scope and price agreed before work starts |
| Recurring supplies from a preferred supplier | Yes, per release | Blanket PO | Price agreed once, each release approved |
| Restock by a buyer within an agreed plan | Often no | Yes | Buyer has standing authority within the stock plan |
| Subscriptions and renewals | Yes, at renewal | Optional | The approval matters more than the order document |
| Small purchases under the threshold | No | No | Company card or expense report within policy |
| Utilities, rent, taxes | No | No | Governed by contract or law, paid on schedule |
- Equipment, inventory, larger supplies
- RequisitionYesPurchase orderYesWhyNeeds approval, agreed price and receipt for matching
- Services with a defined scope
- RequisitionYesPurchase orderYesWhyScope and price agreed before work starts
- Recurring supplies from a preferred supplier
- RequisitionYes, per releasePurchase orderBlanket POWhyPrice agreed once, each release approved
- Restock by a buyer within an agreed plan
- RequisitionOften noPurchase orderYesWhyBuyer has standing authority within the stock plan
- Subscriptions and renewals
- RequisitionYes, at renewalPurchase orderOptionalWhyThe approval matters more than the order document
- Small purchases under the threshold
- RequisitionNoPurchase orderNoWhyCompany card or expense report within policy
- Utilities, rent, taxes
- RequisitionNoPurchase orderNoWhyGoverned by contract or law, paid on schedule
The common mistake is at both ends. Companies with no requisitions find out about purchases from the invoice. Companies that demand a requisition and a PO for a $40 cable teach employees to avoid the process altogether. Thresholds solve both, and we cover how to set them in purchase approval workflow.
Why finance needs both documents
It is tempting to merge the two: let the requester create the PO directly and approve it. That works in very small teams, but it blurs two controls that are better kept apart:
- The requisition proves that the purchase was authorized by someone with budget authority, before commitment.
- The PO proves what the supplier agreed to and is what the invoice gets matched against.
When auditors test purchasing, they typically pick invoices and trace them back: was there a PO, was the PO approved, by whom, and was the approver authorized for that amount? A linked requisition answers the last two questions in one click. For what happens after the PO, see purchase order vs invoice and three way match explained.
Common mistakes with requisitions and POs
- Treating the requisition as the order. An approved requisition emailed to a supplier is not a PO. It has no agreed price, no payment terms and no PO number for the invoice to quote.
- Creating the PO after the invoice. A PO raised to match an invoice that already arrived records the purchase but controls nothing. If this happens often, approvals are too slow or the threshold is too low.
- Letting the PO drift from the requisition. Price, quantity or supplier changes between approval and order should route back to the approver above a set margin.
- Losing the link. When requisitions live in email and POs in a spreadsheet, nobody can show which approval covers which order. Keep both in one system with one reference.
- Keeping requisitions open forever. Approved requisitions that never became a PO still hold budget. Close them after a set period, such as 30 days.