Matakuliah
Tahun
: F0204 / Sistem Akuntansi
: 2007
Purchasing Process
Pertemuan 15 – 16 – 17
Process Definitions and Functions
1. The purchasing process is an interacting
structure of people, equipment, methods,
and controls that is designed to accomplish
the following primary functions:
2. Handle the repetitive work routines of the
purchasing department and the receiving
department
3. Support the decision needs of those who
manage the purchasing and receiving
departments
4. Assist in the preparation of internal and
external reports
Bina Nusantara
Internal Perspective of Purchasing Process
1. Purchase
requisition sent
from inventory
control department
to purchasing
department
Bina Nusantara
Internal Perspective of Purchasing Process
2. Purchase
requisitions from
various other
departments sent
to purchasing
department
Bina Nusantara
Internal Perspective of Purchasing Process
3. Purchase order
sent to vendor
Bina Nusantara
Internal Perspective of Purchasing Process
4. Purchase order
notification sent to
various other
departments or to
inventory
management
process
Bina Nusantara
Internal Perspective of Purchasing Process
5. Purchase
order notification
sent to receiving
department
Bina Nusantara
Internal Perspective of Purchasing Process
6. Purchase order
notification sent to
accounts payable
process
Bina Nusantara
Internal Perspective of Purchasing Process
7. Good and
services received
from vendor
Bina Nusantara
Internal Perspective of Purchasing Process
8. Receiving
notification sent to
accounts payable
and general ledger
processes
Bina Nusantara
Internal Perspective of Purchasing Process
9. Receiving
notification sent
to purchasing
department
Bina Nusantara
Goal Conflicts and Ambiguities in the Organization
• Individual managers’ goals may not be in congruence with organizational
objectives
– Purchasing may buy large quantities of inventory for quantity discounts
and to reduce ordering costs
– This may drive up costs of receiving, inspecting, and carrying inventory
• Ambiguity often exists in defining goals and success in meeting goals.
– A purchasing goals might be to select a vendor who will provide the best
quality at the lowest price by the promised delivery date
– Realistically, one vendor probably will not satisfy all three conditions
• Prioritization of goals is necessary in choosing the best solution given the
various conflicts and constraints placed on the process
– Trade-offs are made in prioritizing among the goals that conflict
– If the market is sensitive to satisfying customer needs, the company may
pay higher prices to ensure that it is procuring the best quality goods and
obtaining them when needed
Bina Nusantara
Inventory Reorder Methods
• Reorder point analysis
– each item is assigned a reorder point based on its sales rate
• Economic order quantity
– order quantity based on costs of ordering and carrying
inventory
• ABC analysis a technique for ranking items in a
group based on the output of the items
– ABC analysis can be used to categorize inventory items
according to their importance
Bina Nusantara
Data Stores Used in the Purchasing Process
• Inventory master data
– A record of each item stocked or regularly ordered
• Vendor master data
– Stores information about approved vendors including vendor
performance
• Purchase requisition data
– Data on all purchase requisitions
• Purchase order master data
– Open PO information including status of items on order
• Purchase receipts data
– Lists items received
Bina Nusantara
Purchasing Process Systems Flow Chart
Bina Nusantara
Purchasing Process Systems Flow Chart, Cont’d.
Bina Nusantara
Fraud and the Purchasing Function
• Many frauds involve manipulation of purchasing
because it involves the payment of cash
– The typical cases included in this category of process
exploitation are instances in which:
• An employee (e.g., a buyer, purchasing manager, or other
person) places purchase orders with a particular vendor in
exchange for a kickback, secret commission, or other form of
inducement from the vendor.
• An employee has a conflict of interest between his
responsibilities to his employer and his financial interest—direct
or indirect—in a company with whom the employer does
business.
Bina Nusantara
Purchasing Control Matrix
Bina Nusantara
Control Matrix, Cont’d.
Bina Nusantara