Purchase Requisition

A purchase requisition (often abbreviated to PR) is the internal approval document that kicks off a formal procurement process. An employee or department identifies a need for goods or services, completes the requisition, and submits it to the appropriate approver. Once approved, the procurement team or business owner can raise a purchase order and contact the supplier.

The key distinction is scope: a purchase requisition is an internal document only. It has no legal standing with a supplier and creates no commitment to buy. A purchase order, by contrast, is a formal external document issued to a supplier that creates a contractual obligation. The PR comes first, the PO follows once internal approval is granted.

What a Purchase Requisition Contains

A standard PR typically includes the name and department of the person requesting the purchase, a clear description of the goods or services needed with quantities and specifications, an estimated cost, the suggested supplier if known, a budget code or cost centre for allocating the expense, and the required approval signatures.

For high-value purchases, some businesses apply tiered approval - a line manager approves below a certain threshold, finance sign-off is required above it. These thresholds should be defined in the company's procurement policy so everyone knows what level of spend they can approve independently.

Why the Requisition Step Matters

Without a requisition step, employees can place orders directly with suppliers without any internal visibility or cost control. The PR creates an approval gate before money is committed. This serves several purposes.

First, it prevents unauthorized spending. A supplier receives a purchase order believing it is an authorized commitment. If no internal approval was sought, the business may find itself committed to spend that was not in budget or does not align with business priorities.

Second, it creates an audit trail. When a purchase is queried - by a manager, auditor, or finance team - the requisition shows who requested it, when, what it was for, and who approved it. That trail is particularly valuable during year-end reviews or supplier audits.

Third, it improves planning. Finance teams can see approved but unfulfilled requisitions as committed future spend, which is useful for cash flow forecasting and tracking budget consumption on a live project.

In Zigaflow, the purchase order module supports internal approval workflows, so requisitions and their sign-off can be tracked alongside the POs they generate.