In today’s video, we will talk about setting buying limits also known as purchase approval thresholds for individual users.
Purchase Approval Thresholds are set in the individual user maintenance settings.
While Buyer IDs are used in Purchase Orders, they do not affect the purchasing limit of a person, so you do not set PO limits in individual user maintenance settings.
User Maintenance Settings:
When you open User Maintenance in Prophet 21, you may notice the Buyer ID is listed. All that section will do is set the default buyer.
The setting in User Maintenance we want to focus on is the Needs PO Approval setting. When you check this box, the PO Approval Threshold number gets highlighted.
Entering the Purchase Order Approval Threshold:
When you enter a number in the PO Approval Threshold box, you are telling the system that any PO below that amount can be saved as approved by this user.
Anything above that would have to be unapproved and somebody with authorization would have to come and approve the Purchase Order.
Now if you left that amount as zero, that is essentially saying every PO that this buyer buys will have to be individually approved.
Depending on your business process, you may want to always keep this number as zero. This would require somebody to come in and review all POs before they get placed and sent to the vendors.
Once you have entered an acceptable threshold, hit Save to process the PO Limit.
Example PO Threshold Use Case:
- Start by opening a PO.
- On the PO, your extended price is set at $450 and your threshold is set to $500.
- Now, changing the quantity to $550 will push you over the $500 mark.
- While it still appears to be approved, when you attempt to save the Purchase Order, your system will give you an error message and mark it as unapproved. When you reopen the PO, you will see that it has changed to unapproved. Even if you try to save it, P21 will not allow you to process the order without approval.
- However, if you change the amount to below the $500 threshold, mark it approved, and hit save, it will then process normally.
Conclusion on Purchase Order Thresholds:
Setting Purchase Order Thresholds is a simple way to control how much individual users can purchase. Stay tuned for some more videos on purchase orders and other ways to utilize user maintenance in Prophet 21.
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