OASYS Tech solutions pvt. Ltd.

PROCURE TO PAYMENT CYCLE :

Every organization acquires material or services to complete its business needs. The process
of buying materials and obtaining services from vendors or dealers is procurement. The
steps which are required to procure a material forms the procurement cycle. Every
organization performs some common sequential steps so that a material can be procured in
right quantity at the right price. The important steps in procurement cycle are as follows:
 Determination of Requirement
 Creating Purchase Order
 Posting Goods Receipt
 Posting Invoice

OASYS Tech solutions pvt. Ltd.

PROCESS FLOW :

OASYS Tech solutions pvt. Ltd.

PROCURE TO PAYMENT CYCLE :

 PURCHASE REQUISITION.

 PURCHASE ORDER.

 GOODS/SERVICE RECEIVE. [MIGO]

 INVOICE RECEIVE/VERIFICATION. [MIRO]

 PAYMENT TO VENDOR.

OASYS Tech solutions pvt. Ltd.

PROCURE TO PAYMENT CYCLE :

OASYS Tech solutions pvt. Ltd.

PURCHASE REQUISITION :
Procurement in every organization starts with gathering requirements. Once requirements
are gathered we need to inform the purchasing organization. Purchase Requisition is a
document that will contain list of requirements. The key points about purchase requisition
are as follows:
 Purchase requisition is a request that is made to purchasing organization to procure
certain list of material.
 Purchase requisition is an internal document; specifically it remains within the
organization.
 Purchase requisition needs approval from purchasing organization.
 If purchase requisition is approved then changes are possible only to limited extent.

OASYS Tech solutions pvt. Ltd.

PURCHASE ORDER :

 A purchase order (PO) is a commercial document and first official offer issued by
a buyer to a seller, indicating types, quantities, and agreed prices for products or services.
It is used to control the purchasing of products and services from external
suppliers. Purchase orders can be an essential part of ERP system orders.

 The issue of a purchase order does not itself form a contract. If no prior contract exists,
then it is the acceptance of the order by the seller that forms a contract between the
buyer and seller.

OASYS Tech solutions pvt. Ltd.

GOODS / SERVICE RECEIVE :

OASYS Tech solutions pvt. Ltd.

GOODS / SERVICE RECEIVE :
Goods receipt is the phase in which the material is received by the ordering party and the
condition and quality are verified. Depending upon the movement type stock is posted in
inventory with the help of goods receipt. Goods receipt will show increase in warehouse
stock. Goods receipt has two scenarios which are as follows.

 Creation of Goods Receipt

 Cancellation of Goods Receipt

OASYS Tech solutions pvt. Ltd.

INVOICE RECEIVE / VERIFICATION :
Every organization acquires goods or services to complete its business needs. Once goods are
procured from vendor and placed in company’s premises through goods receipt then we need
to pay to vendor for acquired goods and services. The amount to be paid along with details of
material is provided by vendor in form of document that is known as invoice. Before paying to
vendor we need to verify the invoice. This process of verifying invoice and paying to vendor is
known as invoice verification. The key points about invoice verification are as follows.
 Invoice verification marks the end of procurement after purchase order and goods
receipt.
 Invoice posting will update all related documents in financial and accounting.
 Blocked invoice that vary from actual invoice can be processed through invoice
verification.

OASYS Tech solutions pvt. Ltd.

PAYMENT TO VENDOR :

OASYS Tech solutions pvt. Ltd.

OASYS Tech solutions pvt. Ltd.