What is Requisition?
A requisition is a formal request made by an employee or department within a company to procure goods or services. It serves as the first step in the procurement process, ensuring proper authorization and record-keeping before proceeding with a purchase.
Key Points About Requisition:
- Purpose:
- It initiates the purchasing process by requesting necessary items or services.
- Helps maintain organized internal records and budget control.
- Difference from Purchase Order:
- A requisition is the request for approval to purchase, while a purchase order is the document used to finalize and execute the purchase.
- A requisition always precedes a purchase order.
- Importance in Organizations:
- Facilitates clear communication between departments.
- It helps large organizations manage accounting and finances more efficiently.
The Requisition Process:
- Filling Out a Requisition Form:
- The requesting employee or department completes a requisition form specifying the required goods or services.
- Submission for Approval:
- The form is submitted to the finance or procurement department for review and approval.
- Authorization:
- The requisition is either approved or returned for clarification or adjustments.
- Transition to Purchase Order:
- Once approved, the requisition is converted into a purchase order to proceed with the purchase.
How HR teams use this term
HR teams usually use Requisition when they write policies, explain employee communication, review payroll or leave records, or keep employee data clean in an HRMS.
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