Purchase order approval levels overview

The purchase order (PO) approval levels feature lets you limit PO totals for users. When you enable approval levels, the program adds the PO Estimate field to POs. If a user creates a PO with an estimate that exceeds their approval limit, the PO is placed into Pending status. A user with a qualifying approval level can then approve or reject the PO.

  • Work with approval levels

  • [Assign or remove approval levels]

  • [Set the Require PO Approval Levels option ]

  • [Work with standard purchase orders]

Work with approval levels

Use the Edit Approval Levels section of the Approval Levels page to:

  • Add approval levels to the system.

  • Edit existing approval levels.

  • Delete approval levels from the system.

IMAGE HERE

Add approval levels

When you’re creating approval levels for the first time, remember that the new levels will not go into effect until you ?tab=t.0#heading=h.30j0zll[set the ]?tab=t.0#heading=h.30j0zll[Require PO Approval Levels ]?tab=t.0#heading=h.30j0zll[option to ]?tab=t.0#heading=h.30j0zll[YES].

  1. Go to Menu > Setup > Order Setup > Approval Levels. The Approval Levels page opens.

  2. In the* Edit Approval Levels* section, select Add new. The Add Approval Level window opens.

    IMAGE HERE

  3. Complete these fields: Required field: *

Field Definition

Approval Level Name *

Enter a name for the approval level, such as Standard Approval Level.

Repair Order Amount *

Enter a repair order approval limit, such as $500.00.

Purchase Order Amount

Enter a purchase order approval limit, such as $500.00.

Vendor Repair Order Amount *

Enter a vendor repair order approval limit, such as $500.00.

Note: *If your company is only using purchase order approvals, you may leave the *Repair Order Amount and Vendor Repair Order Amount as $0.00.

  1. Select Save. The Add Approval Level window closes. The Approval Levels page displays the new approval level. This illustration shows an example of an approval level.

IMAGE HERE

Edit approval levels

  1. Go to Menu > Setup > Order Setup > Approval Levels.

  2. Select an approval level row. The row is highlighted.

  3. Select Edit. The Edit Approval Level window opens.

    IMAGE HERE

    Note: You cannot edit an approval level if it is actively assigned to a user.

  4. Edit these fields as required:

    Required field: *

    Field Definition

    Approval Level Name *

    Enter a name for the approval level, such as Standard Approval Level.

    Repair Order Amount *

    Enter a repair order approval limit, such as $500.00.

    Purchase Order Amount

    Enter a purchase order approval limit, such as $500.00.

    Vendor Repair Order Amount *

    Enter a vendor repair order approval limit, such as $500.00.

  5. Select Save. The Edit Approval Level window closes. The Approval Levels page displays the revised approval level.

Delete approval levels

  1. Go to Menu > Setup > Order Setup > Approval Levels. The Approval Levels page opens.

  2. Remove the approval level you want to delete from any associated users. If any users are assigned to the approval level, you get an error message that says, “Cannot delete approval level as it is assigned to user username.”

  3. In the Edit Approval Levels section, select the approval level that you want to delete. The row is highlighted.

  4. Select Delete. A confirmation message opens. It asks, "Are you sure you want to delete the approval level name Approval Level?"

    IMAGE HERE

  5. Select OK. The Edit Approval Levels section refreshes to remove the approval level. To close this window without saving your changes, Select Cancel.

Assign or remove approval levels

Use the Assign Approval Levels section of the Approval Levels page to:

  • Assign approval levels to users.

  • Remove approval levels from users.

IMAGE HERE

Exclude inactive users

The Approval Levels page excludes inactive users from the Assign Approval Levels list by default. Select the Include Inactive Users/Exclude Inactive Users option to show or hide inactive users.

IMAGE HERE

You can see which users are active in the *Active *column.

IMAGE HERE

This column shows a checkbox for each user in the grid. If the user is active, the checkbox is selected. If the user is inactive, the checkbox is cleared. The checkboxes are read-only.

Assign approval levels to an individual user

If you need to assign approval levels to multiple users, see ?tab=t.0#heading=h.so208u43a33s[Bulk Assign approval levels].

  1. Go to Menu > Setup > Order Setup > Approval Levels. The Approval Levels page opens.

  2. In the Assign Approval Levels *section, select the *Approval Level Name column next to the user you want to assign a level. A dropdown list opens with an active cursor.

    IMAGE HERE

  3. In the Approval Level Name field, use the dropdown menu to select an approval level. The page saves the approval level.

    IMAGE HERE

Bulk assign approval levels

  1. Go to Menu > Setup > Order Setup > Approval Levels. The Approval Levels page opens.

  2. Select the checkboxes beside the user rows in the Assign Approval Levels table.

  3. Select Bulk Assign in the lower-right corner of the page. The *Bulk Assign *Window opens.

  4. Select the Approval Level Name from the dropdown list.

  5. Select Save. The Bulk Assign window closes, and the Approval Levels page refreshes to show the users’ new approval levels.

Remove approval levels from users

  1. Go to* Menu > Setup > Order Setup > Approval Levels. *The Approval Levels page opens.

  2. In the Assign Approval Levels section, select the Approval Level Name column next to the user you want to remove the approval level from. A dropdown list opens with an active cursor.

  3. In the Approval Level Name field, delete the approval level name. You can either use the BACKSPACE key or select the text and press DELETE. Once you remove all the text, the page removes the level from the user.

  4. Repeat Steps 2 and 3 for additional users as needed.

Set the Require PO Approval Levels option

  1. Go to Menu > Setup > Options > Application Options. The Application Options page opens.

  2. In the Category pane, expand Purchasing. The list of Purchasing options opens.

  3. Select Approvals. The Options pane displays a list of options.

  4. Set Require PO Approval Levels to YES. Note: *This option applies to standard POs only. If you want to apply approval levels to vendor POs, you must set *Require VRO/PO Approval Levels to YES. You can set these two options independently.

  5. Select Save. This illustration shows the Application Options page with Require PO Approval Levels set to YES.

IMAGE HERE

*Note: *When you turn on approval levels, all POs in process (that is, that are not complete, closed, or canceled) are set to Approved.

Enable Allowed Cost Overage

Allowed Cost Overage is a child option under Require PO Approval Levels. The setting defaults to_ 0%_, meaning the program will not allow any overage beyond the approved PO estimate amount. You can enter acceptable cost overage as a percentage.
You must set Require PO Approval Levels to _YES _before you can enable Allowed Cost Overage.

  1. Go to Menu > Setup > Options > Application Options. The Application Options page opens.

  2. In the Category pane, expand Purchasing. The Options pane displays a list of options.

  3. Do one of the following to set an overage percentage:

    • Left-click in the *Allowed Cost Overage *field and enter a value. Select the arrows next to the Allowed Cost Overage field to change the value up or down.

  4. Select Save. After Allowed Cost Overage is enabled, a warning appears when users change the PO estimate through adding lines to the PO. The warning text changes based on the overage total. For example, if the new estimate total is:

    • Below your approval level amount but _above _*the allowed cost overage amount:* The window shows the warning, "New Order Total is above the Estimated Amount. Do you want to update the Estimated Amount?" Clicking *YES *will update the PO Estimate amount to a total that includes the addition of the new line. Since the PO total is still below your approval level, the PO will remain in an Approved status.

    • Above your approval level amount and above* the allowed cost overage amount:* The window shows the warning, "New Order Total is above the Estimated Amount. Do you want to update the Estimated Amount?" Clicking Yes will update the PO Estimate amount to a total that includes the addition of the new line. The order will be moved to Needs Approval status and will require approval again by a user with a higher approval level.

    • Above your approval level amount but below* the allowed cost overage amount:* No warning is displayed and lines may be added and received at a value within the allowed cost overage amount of the approved PO estimate. Overage examples Example 1:

    • Require PO Approval Levels is set to YES.

    • *Approved Cost Overage*is set to 10%.

    • Your approval level amount is $200.

    • The PO’s approved estimate is $100. The current PO total is $100. The 10% cost overage setting means the maximum approved amount is $110.
      Scenario 1:
      You add a $5 tax line. The program lets you save your change because $105 is less than $110.
      Scenario 2:
      You try to add a $15 freight line. The warning window opens with the message "New Order Total is above the Estimated Amount. Do you want to update the Estimated Amount?" Clicking Yes will update the PO Estimate amount to a total that includes the addition of the new line. Since the new PO total of $115 is still below your approval level of $200, the PO will remain in an Approved status.

Example 2:

  • *Require PO Approval Levels *is set to YES.

  • Approved Cost Overage is set to 10%.

  • Your approval level amount is $50.

  • The PO’s approved estimate is $100. The current PO total is $100. The 10% cost overage setting means the maximum approved amount is $110.
    Scenario:
    You try to add a $15 freight line. The warning window opens with the message "New Order Total is above the Estimated Amount. Do you want to update the Estimated Amount?" Clicking Yes will update the PO Estimate amount to a total that includes the addition of the new line. The order will be moved to Needs Approval status and will require approval again by a user with a higher approval level.

Other User and Application Options

There are User and Application Options that may affect PO approvals. These options are:

  • Setup > Options > Application Options > Purchasing > Show Pending PO Number when PO Status is Pending This setting controls how the system displays the PO number when the PO is in a Pending status:

  • If set to NO, the program does not show the PO number until the PO is approved. The program shows a series of number signs (##) instead of the purchase order number. This is called masking.

  • If set to YES, the system shows the PO number upon order creation.

  • Setup > Options > User Options> (Select User) > Purchasing > Receiving > Allow User to Receive POs This setting controls whether the user can receive POs:

  • If set to NO, the user cannot receive POs.

  • If set to YES, the user can receive POs.

  • Setup > Options > User Options> (Select User) > Purchasing > Receiving > **Allow User to Close POs This setting controls whether the user can close POs:

  • If set to NO, the user cannot close POs.

  • If set to YES, the user can close POs. *Note: *Both the Allow User to Receive POs and the Allow User to Close POs options let you structure the separation of duties required by Sarbanes-Oxley.

Work with standard purchase orders and the PO approval process

Here are examples of the PO approval process.

Standard PO

  1. Start a new PO.

    • The PO defaults to an Open status.

    • If Show Pending PO Number when PO Status is Pending is enabled, the Order Number is masked.

  2. Fill out the required fields, including the PO Estimate.

  3. Save the PO. If the estimate is higher than your approval level:

    • The Order Status is set to Pending.

    • The Approval Status is set to Needs Approval.

    • The PO Estimate field is disabled and may be edited by clicking the ‘Change PO Estimate’ button.

  4. You may continue working on the PO while waiting for approval.

  5. A user with a high enough approval level approves the PO.

    • The Order Status changes back to Open.

    • The Approval Status is set to Approved.

    • If the Order Number was masked, it is unmasked.

  6. If the PO Estimate changes and its new value is above your approval level, the Order Status *returns to Pending and the *Approval Status returns to Needs Approval.

Received PO

  1. Open a PO that is in a Received status.

  2. Receive parts on the PO. If the received total is higher than your approval level:

    • The Order Status is set to Pending.

    • The Approval Status is set to Needs Approval.

  3. You may continue working on the PO while waiting for approval.

  4. A user with a high enough approval level approves the PO.

    • The Order Status is set to Open.

    • The Approval Status is set to Approved.

  5. If the PO Estimate changes and its new value is above your approval level, the Order Status *returns to Pending and the *Approval Status returns to Needs Approval.

Approve or reject a purchase order

You can approve or reject POs that have a PO estimate that is lower than or equal to your approval level. You can start the approval process from either the Purchase Orders Listing page or from the PO itself.
To start the process from the Purchase Orders Listing page, select Approve in the Action column for the PO you want to approve:

IMAGE HERE

To start the process from the PO itself, open the PO and then select Approve:

IMAGE HERE

The steps are the same after you select Approve.

  1. Select Approve. The Approve PO# window opens.

    IMAGE HERE

  2. In the Approval tab, click in the Comments field and enter a reason for the approval.

  3. Do one of the following:

    • Select Approve. The Approve PO# window closes and the Order Status changes to Open. The Approval Status changes to Approved. The approval appears in the PO’s Approval History tab.

    • Select Reject. The Approve PO# window closes and the Order Status *stays as Pending. The *Approval Status changes to Rejected. The rejection appears in the PO’s Approval History tab.

    • Select Reject & Cancel. The Approve PO# window closes and the Order Status changes to Canceled. The approval status changes to Rejected. The rejection and cancellation appear in the PO’s Approval History tab.

    • Select Close. The Approve PO# window closes and the Order Status does not change.

Resubmission process

If a PO is rejected, the user can resubmit the PO for approval.

  1. Open the purchase order.

  2. Make edits, if needed.

  3. Select Resubmit for approval. The order approval status changes from REJECTED _to _NEEDS APPROVAL.

  4. The PO goes through the approval process again.

PO estimates

When you start a new PO, you must fill out the PO Estimate *field before you can save it. After you have saved the PO, you can select *Change PO Estimate to change the estimate manually. However, after a PO has been approved you cannot select Change PO Estimate unless you have:

  • Approval permissions.

  • An approval limit higher than the current estimate. If you do not meet these requirements, the Change PO Estimate option is not active.
    Note: The PO Estimate can still update automatically if you add lines to the PO that exceed the current estimate.

If the order has been approved, TMT checks your approval limit when you add lines to a PO. If the new total is less than the estimate and less than your approval limit, a confirmation window opens. The message asks, "New Order Total is above the Estimated Amount. Do you want to update the Estimated Amount?"

IMAGE HERE

  • If you select YES, the PO estimate amount updates to the new order total and saves the line changes.

  • If you select NO, TMT removes the line that put the PO over the approved amount. If the new total exceeds your approval limit, the *Approval Status *changes from Approved to Needs Approval.

Auto or Manual Requisitions

POs created from Manual or Automatic Requisitions auto-populate the PO Estimate field with the total of the line item details. The program uses the approval level of the user who creates the POs from the requisition list to set the PO’s status and check whether approval is necessary.

Editing, receiving, and closing POs created by a requisition follow the same approval rules as a PO that was created manually.