1. The Purchasing Process
The purchasing process begins with a request for goods or services and ends with the payment of cash to the vendor.
Purchase may be for either goods or services and for cash or on credit.

2. Objectives of the Purchasing Process
Tracking purchases of goods and/or services from vendors
Tracking amounts owed
Maintaining vendor records
Controlling inventory
Making timely and accurate vendor payments
Forecasting purchases and cash outflows

3. Inputs to the Purchasing Process
Purchase Requisition - shows items requested by stores and may indicate the name of the vendor
Purchase Order - based on purchase requisition but also includes vendor information and payment terms
Vendor Invoice - includes items shipped by vendors, prices, shipping terms and discounts provided
Receiving Report - reflects the count and condition of received goods
Bill of lading – accompanies the goods sent
Packing slip – included in the merchandise package
Debit/Credit Memoranda - debits or credits accounts payable

4. Outputs of the Purchasing Process
Financial Statement Information
Vendor Checks - should be supported by a voucher and signed by a person designated by management
Check Register - lists all checks issued for a particular period
Discrepancy Reports - used to identify any differences among quantities on the purchase order, receiving report, and vendor invoice
Cash Requirements Forecast - predicts future payments and payment dates by reference to outstanding purchase order, unbilled receiving reports and vendor invoices

5. Most Important Control in the Purchasing Process
The most important control of the Purchasing process is to control the relationship between the purchasing agent and the vendor.
This is done by using a Master Vendor List.
Request for Bid (RFB) or Request for Proposal (RFP).