Set up approvals for Purchasing transactions

Sound business practices include having good internal controls to ensure appropriate approval by the right people for spending in your company. You can set up purchasing approvals so you can maintain the proper accountability for purchasing transactions.

Learn more about purchasing approvals before setting them up.

To use purchasing approvals, your company must be subscribed to Purchasing.

Set up purchasing approvals

Complete the following steps to set up purchasing approvals.

At a minimum, the users you want to be approvers need to be subscribed to the Purchasing application and have permission to list the transactions that need their approval. Users with any user type except CRM can be approvers.

Subscription Administration
User type Business user with admin privileges
Permissions Users: List, View, and Edit
  1. Go to Company > Admin > Users, select Subscriptions for the user, then select Permissions for the Purchasing application.
  2. Find the Approve purchase transaction permission, and select List.
    If you plan to use permission-based value approvals, you'll need to assign Purchasing Approval Levels to the appropriate users you want at each level.

Learn more about assigning permissions.

You enable approvals on the Configure Purchasing page and, in a multi-entity, shared environment, at the top level.

Subscription Administration, Purchasing
User type Business user with admin privileges
Permissions Application Subscriptions: List, View, and Configure
  1. Go to Purchasing > Setup > Configuration.
  2. In the Approvals subsection of the Enable functionality section, select the Enable purchasing approval checkbox. Various options and buttons appear.
  3. Set the following options as needed:
    • Require supplier for approval. Select to require that a supplier must be specified on the transaction before it's sent for approval. After a supplier is selected for the transaction, the supplier cannot be changed.
    • Require a new approval cycle if an approved transaction is modified. Select an option that determines if amount changes to approved transactions require the transaction to be approved again. This configuration option is not supported if your company is also set up for the Spend Management subscription.
    • Email notifications. Select to automatically send email notices to users in the purchasing approval chain. The users set their preferences for whether to receive emails.
    • Enable delegation. Select to allow approvers to delegate their approval responsibility when they’re away. Admin setup is required to assign delegates to the approvers. Learn about setting up approval delegation.
    • Unrestricted. Select a super user who can terminate the rest of the approval cycle for a transaction by approving or declining the transaction.

Next, define your approval policies.

Approval policies determine which purchasing transactions require approval, which approvals are required, the sequence of approval, and whether any of the approvals should be based on the transaction amount. You can define approvals for purchase requests (quotes), purchase orders, and PO purchase invoices.

  1. Go to Purchasing > Setup > Configuration.
  2. In the Enable functionality section, go to the Approvals subsection and select the Approval policies Manage button. The Purchasing approval policies list page appears.
  3. Select Add. The Purchasing approval policy page appears.
  4. Select a Transaction definition. The policy will apply to purchasing transactions based on the transaction definition you choose.
  5. For each approval that you want to route the purchasing transaction through, select the Rule type. For more details, see the field descriptions for the Approval Policy page.
    If you select Value Approval - Department or Value Approval - Transaction Department, add a rule set to apply to the rule type and define the value approval rules for the rule set. See Add a rule set for department-based value approvals.

    If you select, Value Approval or Value Approval - Progressive, add a value approval rule. See Add a value approval rule for permission-based value approvals.

  6. Select Save.
  7. Repeat steps 3 to 6 for each approval policy that you want to define.
  8. Select Cancel to return to the Configure Purchasing page.

Learn more about using approval policies.

Add a rule set for department-based value approvals

If you selected Value Approval - Department or Value Approval - Transaction Department as a rule type in an approval policy and have not previously set up a rule set, you need to add a rule set. The rule set contains the value approval rules to use, which include:

  • The default value approval rule for any department that does not have its own specific value approval rule
  • Any additional value approval rules for any departments that need their own specific rules
A value approval rule defines the approvers that you want and their approval amounts. While one value approval rule might work for most of your departments, other departments might need their own rules with different approvers, approval amounts, or both.
Subscription Purchasing
User type Business user with admin privileges
  1. Go to Purchasing > Setup > Configuration.
  2. In the Enable functionality section, go to the Approvals subsection and select the Approval policies Manage button.
  3. On the Purchasing approval policies page, edit a policy which contains a rule type of Value Approval - Department or Value Approval - Transaction Department.
  4. On the associated Rule type line, select the Rule set dropdown list and then select Add. The Value Approval Rule Set page appears.
  5. Enter a Rule set name.
  6. Specify the default value approval rule to apply to any department without its own specific value approval rule. For each approver you want:
    • Select a Rule type approver. If required, select a user or user group. For a named user to appear in the User or user group column, the user or user group members must have permission to list purchasing transactions that need approval and must not be restricted to any entities, departments, or territories.
    • Enter Value from and Value to to specify the minimum and maximum approval amounts for the approver. For the first approver, you can specify a non-zero value for the minimum amount. For the last approver, leave the maximum amount empty.

    See field descriptions for the Value Approval Rule Set page for details.

  7. Select Save. The Purchasing approval policy page appears.

After you've added the default value approval rule, you can add value approval rules for specific departments.

To add a value approval rule for a specific department:

  1. On the Purchasing approval policy page, in the Rule set column, select the drop down menu and select View or Add. The Value approval rule set page appears.
  2. Select Edit.
  3. In the Department-specific rules section, select Add. The Value approval rule page appears.
  4. Select a Department ID.
  5. Add an optional Description.
  6. In the Approval routing and limits section:
    • Select a Rule type approver. If required, select the name of the user or user group. Only users and user groups with members who have permission to list purchasing transactions that need approval appear in this list.
    • Enter Value from and Value to to specify the minimum and maximum approval amounts for the approver. For the first approver, you can specify a non-zero value for the minimum amount. For the last approver, leave the maximum amount empty.

    See field descriptions for the Value Approval Rule page for details.

  7. Select Save. The Value approval rule set page appears. A row for the department now appears in the table of department-specific rules.
  8. Repeat steps 3 to 7 for each value approval rule that you want to add for a specific department.
  9. Select Save. The Purchasing approval policy page appears.

Learn more about using rule sets.

Add a value approval rule for permission-based value approvals

If you selected Value Approval or Value Approval - Progressive as a rule type in an approval policy and have not previously set up the level approval amounts, you need to add a value approval rule.

These rule types have only one value approval rule. You select the number of levels of approval that you need and the amounts for each level. The approvers for a specific level are those users who have permission for purchasing approval at that level.

Subscription Purchasing
User type Business user with admin privileges
  1. On the Purchasing approval policy page where you have specified Value Approval or Value Approval - Progressive as a rule type, select Add. The Value approval rule page appears.
    If a value approval rule has already been defined, you can select Edit to review the value approval rule and make any necessary changes.
  2. Add an optional Description.
  3. For each level of approval you want:
    • Enter Value from and Value to to specify the minimum and maximum approval amounts for the level. For the last level, leave Value to empty. For the first level, you can specify a non-zero value for the minimum amount.
    • Select Minimum approvers to specify the required number of approvers for the level. Transactions can be approved by anyone with permission for that level of approval.

    See field descriptions for the Value Approval Rule page for details.

  4. Select Save.

Turn off purchasing approvals

Turning off approvals has no effect on purchasing transactions that are currently in the approval cycle. Any new transactions that are submitted will no longer need approval after you turn off approvals. However, your approval policies and value approval rules remain intact and will be used if you re-enable purchasing approvals.

Subscription Administration, Purchasing
User type Business user with admin privileges
Permissions Application Subscriptions: List, View, and Configure
  1. Go to Purchasing > All > Setup and select Configure Purchasing.
  2. In the Approvals subsection of the Enable functionality section, deselect the Enable purchasing approval checkbox. The various options and buttons disappear.
  3. Select Save.

Field descriptions

The following table describes each item on the Approval policy page.

Approval policy page field descriptions
Field Description

Transaction definition

The transactions that require approval. You can set up approvals for transactions with the following template types:

  • Quote (purchase quotes or purchase requisitions)
  • Order (purchase orders)
  • Invoice (PO purchase invoices)
    The PO purchase invoice is posted to the GL after it's been fully approved, using the transaction date as the posting date. In addition, if the transaction definition for the invoice affects inventory quantity and value, the quantity and value is not affected until the invoice is fully approved.

Rule type

Use the rule type to create a sequence of approvals that can include approval by a named user or user group, the user's manager, the manager of the user's department, the amount of the purchase, and more.

For example, you might want a purchasing transaction to be approved first by the submitting employee's manager. If the manager approves, you might want to proceed to value approval based both on the department for the transaction and the purchase amount.

The rule types are:

  • Value Approval: Approval requests are sent based on the purchase amount. The value approval rule for Value Approval and Value Approval: Progressive determines the levels of approval and approval amounts at each level. Approval requests are sent directly to the level in which the purchase amount falls. Users that are restricted to specific entities or departments may not receive notifications for this type of value approval regardless of their email preferences.
  • Value Approval: Progressive: Approval requests are sent based on the purchase amount. The value approval rule for Value Approval and Value Approval: Progressive determines the levels of approval and approval amounts at each level. Approval routing starts at Level 1 and progresses through each level until the purchase amount falls below the next level. Users that are restricted to specific entities or departments may not receive notifications for this type of value approval regardless of their email preferences.
  • Value Approval: Department: Approval requests are sent based on the department of the employee submitting the transaction and the purchase amount. The value approval rule for the department or the default value approval rule if the department does not have its own specific value approval rule, which are defined by the selected rule set, determine the number of approvers and their approval amount limits. Approval routing starts with the first approver and progresses to each successive approver until the purchase amount falls below the next approver's limits.
  • Value Approval: Transaction Department: Approval requests are sent based on the department selected in the transaction and the purchase amount. The value approval rule for the department or the default value approval rule if the department does not have its own specific value approval rule, which are defined by the selected rule set, determine the number of approvers and their approval amount limits. Approval routing starts with the first approver and progresses to each successive approver until the purchase amount falls below the next approver's limits. (Only one department can be selected per transaction.)
  • Department Approval: Approval requests are sent to the manager of the department to which the employee submitting the transaction is assigned.
  • Employee Manager Approval: Approval requests are sent to the manager of the employee submitting the transaction.
  • Transaction Department Approval: Approval requests are sent to the manager of the department selected in the transaction. (Only one department can be selected per transaction.)
  • Transaction Location Approval: Approval requests are sent to the manager of the location selected in the transaction. (Only one location can be selected per transaction.)
  • Transaction Project Manager Approval: Approval requests are sent to the manager of the project selected in the transaction. (Only one project can be selected per transaction.).
  • User Level: Approval requests are sent to a selected user.
  • User Group Level: Approval requests are sent to a selected user group.

User or user group

Select a user or user group. For a named user or user group to appear in the list, the user or user group must have any user type other than CRM, and have permission to list purchasing transactions that need approval. In addition, the user or user group must not be restricted to any entities, departments, or territories.

Rule set

This field is applicable when Value Approval: Department or Value Approval: Transaction Department is selected as the rule type. The rule set identifies the value approval rules used to route the approval requests. Remember, a value approval rule defines the approvers you want and their approval amounts.

A rule set includes the default value approval rule that applies to any department without its own specific value approval rule and, optionally, one or more value approval rules for specific departments. While one value approval rule might work for most of your departments, other departments might need their own rules with different approvers, approval amounts, or both.

Learn more about value approval rule sets and value approval rules.

Manage

This field is applicable when Value Approval or Value Approval: Progressive is selected as the rule type. You can select the Edit link in the Manage column to add or edit the value approval rule used to route the approval requests. The approval rule for both these rule types defines the number of levels of approval needed and the approval amounts for each level. The approvers for a specific level are those users who have permission for purchasing approval at that level.

Learn more about the value approval rule for permission-based approvals.

The following tables describe each item on the Value approval rule set page.

Value approval rule set page field descriptions
Field Description

Rule set name

The name of the rule set.

Rule type

This is a read-only field that indicates the value approval rules are for department-based value approval rule types, which include:

  • Value Approval: Department
  • Value Approval: Transaction Department

Default for departments without specific rules

Default for departments without specific rules field descriptions
Field Description
Rule type

The user type to send the approval request to:

Employee Manager, Department Manager, User Level, User Group Level

User or user group

A named user or user group must have permission to list purchasing transactions that need approval. To assign permission, edit the user's or group member's permission in the Purchasing application and select approve purchasing transactions. Learn more about assigning permissions.

Value from

The minimum amount that can be approved. For the first approver, you can specify a Value from that is greater than zero; any amount below a non-zero value is automatically approved.

If your company is enabled for multiple base currencies and you selected a value approval currency, the approval currency is displayed in the text above the table with the approvers and approval limits. To set the approval currency, see the Entity Preferences section of Manage multiple entities.

Value to

The maximum amount that can be approved. For the last approver, leave Value to empty, which ensures any transaction amount over the last approver's minimum amount is always approved.

Approval requests are routed to the first approver and then to each successive approver until the transaction amount falls below the next approver's limits.

Assume you have a value approval rule that's defined as follows:

  • Approver 1: Department Manager, R500 to R1,000
  • Approver 2: Mark Johnson, R1,000.01 to R5,000
  • Approver 3: Lucy Ruiz, R5,000.01 to no-maximum-limit

Depending on the amount of the transaction, here's how the approval routing would work:

  • R100 transaction amount: Not routed because it's automatically approved.
  • R2,500 transaction amount: Routed to Approver 1 and then to Approver 2.
  • R15,000 transaction amount: Routed to Approver 1, Approver 2, and then Approver 3.

Department-specific rules

Department-specific rules field descriptions
Field Description

Department ID and Department name

The ID and name of the department with its own value approval rule.

Description

The optional note that was entered for the department's value approval rule when the rule was added or edited.

The following tables describe each item on the Value approval rule page.

Page for department-based value approval rules

Department-based value approval rules field descriptions
Field Description

Department ID

The department for the value approval rule.

Description

An optional note about the value approval rule.

Approver, Value from, and Value to

Specify how many approvers that you want and the amounts that require approval.

Approval requests are routed to the first approver and then to each successive approver until the transaction amount falls below the next approver's limits.

Assume you have a value approval rule that's defined as follows:

  • Approver 1: Department Manager, R500 to R1,000
  • Approver 2: Mark Johnson, R1,000.01 to R5,000
  • Approver 3: Lucy Ruiz, R5,000.01 to no-maximum-limit

Depending on the amount of the transaction, here's how the approval routing would work:

  • R100 transaction amount: Not routed because it's automatically approved.
  • R2,500 transaction amount: Routed to Approver 1 and then to Approver 2.
  • R15,000 transaction amount: Routed to Approver 1, Approver 2, and then Approver 3.
  • For each approver, the amounts that can be approved is the limit specified by Value from and Value to. For example, you might define the following three approvers: 
    • Approver 1: Department Manager, R500 to R1,000
    • Approver 2: Mark Johnson, R1,000.01 to R5,000
    • Approver 3: Lucy Ruiz, R5,000.01 to no-maximum-limit
  • Specify Value from and Value to for each approver except the last. For the last approver, leave Value to empty, which ensures any transaction amount over the last approver's minimum amount is always approved. Use contiguous values from approver to approver, leaving no gaps. For example, if Approver 2 is R1,000.01 to R5,000, then the minimum value for Level 3 must be R5,000.01.
  • For Level 1, you can specify a Value from that's greater than zero; any amount below a non-zero value is automatically approved.
  • If your company is enabled for multiple base currencies and you selected a value approval currency, the approval currency is displayed in the text above the table with the approvers and approval limits. To set the approval currency, see the Entity Preferences section of Manage multiple entities.
  • To select a named user as an approver, and not a named role such as Department Manager, the user must have permission to list purchasing transactions that need approval. To assign permission, edit the user's permission in the Purchasing application and select approve purchasing transactions. Learn more about assigning permissions.

Page for the permission-based value approval rule

Permission-based value approval rule field descriptions
Field Description

Description

An optional note about the value approval rule.

Level, Value from, Value to, and Minimum approvers

Specify how many levels of approval that you want, the amounts that require approval, and the number of required approvers. Sage Intacct supports a maximum of 6 approval levels.

For Value Approval, approval requests are sent directly to the approvers for the level in which the transaction amount falls. For Value Approval: Progressive, approval routing starts at Level 1 and progresses through each level until the transaction amount falls below the next level.

Assume that your value approval rule is defined with the following three levels:

  • Level 1:  R500 to R1,000
  • Level 2: R1,000.01 to R5,000
  • Level 3:  R5,000.01 to no-maximum-limit

If the transaction amount is R2,500, here's how the approval requests would be sent:

  • Value Approval: Approval requests are sent directly to Level 2.
  • Value Approval: Progressive: Approval requests are sent first to Level 1 and then Level 2.
  • For each level, the amounts that the approver can approve is the limit specified by Value from and Value to. For example, you might define three levels of approval:
    • Level 1:  R500 to R1,000
    • Level 2: R1,000.01 to R5,000
    • Level 3:  R5,000.01 to no-maximum-limit
  • Specify Value from and Value to for each level except the last. For the last level, leave Value to empty. Use contiguous values from level to level, leaving no gaps. For example, if Level 2 is R1,000.01 to R5,000, then specify R5,000.01 as the minimum value for Level 3.
  • For Level 1, you can specify a Value from that's greater than zero. Any amount below a non-zero value is automatically approved.
  • If your company is enabled for multiple base currencies and you selected a value approval currency, the approval currency is displayed in the text above the table with the approval levels. To set the approval currency, see the Entity Preferences section of Manage multiple entities.
  • Purchasing transactions can be approved by anyone with permission to that level of approval. To assign permission, edit the user's permission in the Purchasing application and select the purchasing approval levels that the user is allowed to approve. Also, ensure that approve purchasing transactions is selected. Learn more about assigning permissions.