Last Updated: February 4, 2019

 by Briley Acker, CPA

The Purchasing module in Sage Intacct allows companies to customize their AP process. This ensures that their current purchasing policies and workflow are both mirrored and enforced in their ERP system. For example, an organization may require the generation of a purchase requisition for any procurement over $1,000. Another example would be a company requiring approval by a department manager before a purchase order can be created.  With the Purchasing module, accounting teams can leverage Sage Intacct to ensure that these policies and procedures are imposed all within their own accounting system.

To set up the workflow phases and their related policies, advanced workflow will need to be enabled in the Purchasing module. This post will introduce purchasing transaction definitions, with a sample workflow within the Purchasing module using Transaction definitions.

To create and manage transaction definitions, you will need to ensure that:

  1. Your company has subscribed to the Purchasing module (standard module with core financial subscription)
  2. Your business user license includes administrative permissions and access to the Purchasing module
  3. Advanced workflow has been enabled on the Purchasing>>Configuration screen (once this setting has been enabled, it cannot be disabled)

With the correct permissions and settings, you will see the option to add and view existing transaction definitions on the Purchasing>>Setup>>Transaction definitions list.

Our sample nonprofit purchasing workflow will begin with a purchasing requisition that is submitted by an employee, to be approved by a department manager. After this manager approves the requisition, a purchase order will be generated.

The final step in the workflow occurs when the vendor invoice arrives. The vendor invoice will be matched with the existing purchase order, and this existing transaction will be converted into an invoice in Sage Intacct – posting a purchasing transaction to your AP subledger.

The 3 steps discussed above, the purchase requisition, the purchase order, and the vendor invoice serve as 3 separate transaction definitions that will need to be added individually to the transaction definition list.

To add a new transaction definition, simply select “Add” on the Purchasing>>Setup>>Transaction definitions list. For the first phase of your workflow, you will want to follow the guidelines below while being aware that Purchasing workflows are unique to each organization and their current personnel and internal controls.

  1. Provide a template name for the transaction definition. Common examples include Purchase Requisition, Purchase Order, Purchase Commitment, etc.
  2. Select the Template type and workflow category best fitting for the definition (as shown in the image below, the best fitting type for a Purchase Requisition would be “Quote”)
  3. An auto-numbering sequence can be created if desired
  4. Adjust the Accounting settings depending on how you would like the entries table to display within the purchasing transaction
    • For a multi-step workflow, the first step generally will not need to post to your general ledger or AP subledger – unless you would like to record the purchase commitment/order into a user defined book or commitment journal, which I will explain in my next blog post.
  5. The Workflow Transaction conversion should be left blank for the first phase in the purchasing workflow
  6. On the Security Configuration tab, you can set the edit/delete policies
    • Also ensure that the create policy is set to New document or Convert
  7. Set the User or User Group permissions on the Security tab if needed
  8. Press “Save” in the top right, and your transaction definition will be ready for use
    After refreshing your browser, you will see it listed in your Purchasing>>All>>Transactions menu

The next 2 phases in our purchasing workflow will be set up similarly. However, we must pay attention to the posting and conversion settings on the transaction definition configuration for subsequent phases.

The modified transaction definition settings for the Purchase Order and Vendor Invoice phases are highlighted below.

Purchase Order

  • Following the steps listed above, ensure that you’re selecting the correct template type of “Order”
  • Once again, you can elect to provide a numbering sequence for new purchase orders or you can elect to inherit the document numbers from the preceding transaction that is being converted into a purchase order
  • Purchase orders generally should not be posted to the subledger until the vendor invoice has arrived.
  • In the workflow conversion, you will want to select any transaction definitions that may need to be converted to a Purchase Order
  • On the Security Configuration tab, decide whether Purchase Order Transactions can only be created with a purchase requisition (Convert Only), or if users should have the ability to add Purchase Orders without requiring the submission of a purchase requisition 

Vendor Invoice

To save time on setup, you can duplicate the Purchase Order transaction definition for the Vendor Invoice step. Be sure to modify the settings that were covered previously in the transaction definition setup and modify based on your needs. The configuration settings described below will need to be updated and are unique to the Vendor Invoice step.

  • Choose where you would like to record the purchasing activity, your Accounts Payable subledger or just the General Ledger in the Transaction posting section
  • Once again, modify the conversion settings so that Vendor Invoices are being converted from the proper transaction type. In this case, vendor invoices should be converted from Purchase Orders.
  • On the Posting Configuration tab, you will need to determine your Accounts Payable offset account, as well as the GL accounts that will be debited when a vendor invoice is created
  • The posting configurations can be based on vendor groups, but are commonly driven by the Item GL group, assigned in the item setup

Once each transaction definition has been saved and users have been granted access to the appropriate definitions, your organization is free to create and convert Purchase Requisitions, Purchase Orders, and Vendor Invoices within the Purchasing module. These transactions will flow in their designated sequence and will offer you more control over your Accounts Payables subledger.