A requisition form is a formal document used to request for an item or service. This document is sent to the branch or department of an organization to whom you are acquiring the material or requesting for the purchase order.
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What is requisition form?
Different organizations and industries consider requisition form an important tool as it prevents them from fraud. Actually, it procures processes within the company. This form comes in a standardize format and organizations use it to make an official requests. Typically, it contains the following details;
- The company’s name who is issuing the requisition form
- The employee’s name
- Goods or services required
- Purpose of the requisition
- Date of making the requisition
- The requestor’s name
- The date of delivery
- The delivery’s location
- Requestor’s signature
However, the content of a requisition form may vary from organization to organization.
The working of requisition form process:
The working of requisition form process may vary on the basis of the specifics of the organization. Let us discuss below its working;
- An employee has to obtain a requisition form in the first step of the requisition form process. In the case of e-procurement, employees will make a request through an electronic form by logging into the system.
- The employee fills out the form in the next step. They explain the purchase and the reason why it is important in the form.
- Next, the approver approves the request when they receive the form and review it. In case of non-approval, a short description is generally given.
- It depends on the company’s policies that whether there is a need to send the requisition form to another department within the organization in order to confirm details.
- After that, the procurement department will receive the requisition form where the purchase will be sourced. To make a purchase order, the procurement will modify the requisition form.
- In the end, a purchase will be made by sending the purchase order to a vendor as a formal request.
What are the different types of requisition forms?
The most common types of requisition forms are given below;
Advanced requisition form
This type of requisition form can be used by field workers who are working in non-government organizations or NGOs. They use it when they want to spend money to complete projects. The finance person who is managing the finances of the organization use this form to make the estimation of the budget that they required for project expenses for the next month.
Materials requisition form
Production managers who are working in the productions department use this form when they want to request materials for their manufacturing processes. Additionally, the material requisition form is submitted to the storage or materials department that gives all of the raw materials. This form is also referred as a source document.
Personnel requisition form
When you realize that a vacant position will open up in your department then to fill a position of new personnel fill out this form. Then, submit it to the department in-charge. Your HR department can start the hiring process as soon as you do this.
Purchase requisition form
A purchase requisition form is an internal document used by the different departments when they want to request purchasing department of their company to order supplies, merchandise, or materials. In the form, they make request that they require these items for their work. The requestor in the form states that what the purchase is and why it’s necessary.
Test or laboratory requisition form
It is the most different type of laboratory requisition form. Patients use this form outside of the organization when they have to make a request for any type of test from any kind of medical institution. In case of multiple tests, you have to submit several forms. However, it depends on the methods of the medical institution.
Include the following details in this form;
- Patient’s important details particularly for the purpose of billing
- The ordering laboratory or physician name
- The requested tests details
- The billing details. This is highly important in case there are various billing options for the patient.
- The collected specimen’s details.
- Determine your specimen’s source in case the specimen isn’t blood.
- The requested test selection.
Reasons for using a requisition form:
Patients or employees basically use a requisition form to make a formal request for particular items, actions or services. In this form, they also demonstrate what they are requesting for and why. Let us discuss below the importance of a requisition form;
- This form makes everything transparent for everyone as it makes sure transparency in the organization. Also, Justification is also required for the request that you make for anything. The main purpose of this document to avoid you from overspending.
- With the help of this form, you can specify some products for the purpose of consistency and functionality. The form also ensures that the description written for the requested items serve the accurate functioning. The requested items that are inconsistent with the system and equipment you have will be waste.
- During the procurement process, the efficiency and standardization of a company enhance by adding accountability at every stage.
However, the most common reason for using requisition form include the following;
- Supply purchases
- Expense reimbursements
- Change order requests
- Invoice discrepancies
The advantages of requisition forms:
There are various advantages of submitting requisition form;
- Since it needs all purchases to be justified, so additional level of transparency is introduced by it to your business.
- This form makes sure compatibility by informing you that a more affordable product can meet the requirements of the company. Thus, it prevents you from overspending on expensive items.
- Your company make more savings when the procurement department can establish a relationship with vendors and receive better deals.
How can you differentiate between a purchase requisition and a purchase order?
Both a purchase requisition form and a purchase order form are used in the process of procuring supplies and materials for your company. This way, the operating becomes smooth. They both have different purposes as well as they are different from each other but they are part of the same process.
A purchase requisition is created by an employee to get internal permission for buying goods or services from an outside vendor. This document is internally approved by the department manager and finance department. Once this document is approved then by using a purchase order, the actual purchasing of goods or services can happen.
Information to include on a purchase requisition form
- The requesting department name
- Location and mailing address of the purchaser
- The exact amount of items
- Description of items
- The outside supplier’s legal name
- The expected price of purchase
- Requested delivery date
The purchasing process become facilitated if the accounting department has more details. Moreover, this purchasing document is made by the purchaser and then they submit it to the finance department.
On the other hand, a purchase order is a binding agreement between all involved parties. After approving of purchase requisition, this external document is used to initiate the sales transaction. It assigns a purchase order number. The assigned purchase order number must be matched with the requisition number as well as they are filed together. The purchase order system proves very useful for organized recordkeeping.
Information to include on a purchase order form
- Name of the purchasing office
- Items to be purchased
- Payment terms
- Invoicing instructions
- Ship to address
- Purchase order number
In the entire accounting system, a purchase order is a key document that prepares the companies properly for audits. It makes the process of accounting efficient which saves business money. Purchase orders can also be requested if one department in a business wants to buy goods or services from another. This internal transaction proves very helpful for large organizations that have departments that are operating with separate budgets.
