Align Reporting Periods for Purchase Order Changes

Align Reporting Periods for Purchase Order Changes: Review Question and Source Records

The primary review question is: Are all purchase order changes and related supplier transactions accurately recorded within the approved reporting period? This ensures that financial records reflect timing and amounts consistent with actual deliveries and invoices.

Key source records for this review include:

• Purchase order revisions: Document all approved modifications to the original purchase order, including quantity or price changes.
• Delivery notes: Confirm which goods or services were actually received and when, as reported by the supplier.
• Supplier invoices: Verify the billed quantities and prices against the purchase order revisions and delivery notes.

These records provide the basis for detailed comparison and discrepancy identification when aligning reporting periods.

Collect, Compare, and Review Source Records

• Verify the current purchase order revisions to identify any authorized changes since the original order.
• Obtain delivery notes corresponding to each purchase order revision, noting quantities and item details.
• Collect supplier invoices referencing the same purchase orders and delivery events.
• Compare quantities on delivery notes to those on supplier invoices, checking for consistency with approved purchase order revisions.
• Confirm prices charged on invoices match the prices authorized in the latest purchase order revision.
• Record any discrepancies in quantity or price, noting if documentation or authorization is missing.
• Ensure all transactions fall within the approved reporting period for the relevant purchase order revision.
• Flag unresolved exceptions for further review, recognizing that this process documents findings but does not confirm resolution.

Example: Handling a Purchase Order Change with Delivery Note and Invoice Review

Suppose a restaurant receives a revised purchase order indicating a change in the quantity of fresh produce ordered. The reviewer starts by confirming the purchase order revision matches the delivery notes accompanying the shipment. If the delivery note shows fewer units than the revised order, the difference is noted. Next, the reviewer compares quantities and prices on the supplier invoice against the approved revision. If the invoice reflects the original order’s higher quantity but with the revised prices, this discrepancy is recorded as unresolved because it conflicts with the delivery note. The reviewer flags this difference and confirms all records correspond to the current reporting period before escalating for further supplier clarification or internal review.

Completion Checklist and Review Report

• Confirm all purchase order revisions have been matched to corresponding delivery notes and supplier invoices within the approved reporting period.
• Verify quantities and prices align between the source records; note any discrepancies or missing authorization.
• Document unresolved exceptions clearly, specifying source documents and nature of issues for transparency.
• Prepare a review report summarizing supported conclusions and open items, referencing verified source records.
• Identify the review owner responsible for follow-up and assign the next reviewer to address outstanding issues or exceptions.

Schedule a financial review

Featured Snippet

Verify purchase order revisions, compare delivery notes and supplier invoices, check quantities and prices, record any discrepancies, and ensure all changes are within the approved reporting period.