Reference Number: CTAS-923
The purchasing cycle encompasses all phases of procuring goods and services essential to maintaining and enhancing operations of county government. A series of consecutive activities constitutes the basic steps in the purchasing cycle. A “sample purchasing cycle (centralized financial management system)” in county government is illustrated below:1
Sample Purchasing Cycle (Basic Steps)
- Need is recognized by the user department.
- User department develops purchase requisition, keeps a copy and forwards original to purchasing (or central finance in 1981 CFMS counties).
- Purchasing reviews requisition for accuracy and completeness.
- If accurate, the purchasing department checks to see if funds are available to purchase the goods or services. The finance department verifies availability of funds.
- The purchasing department checks if goods are available in stock or excess (surplus).
- If funds are available, the purchasing department determines method of purchasing decision of whether regulations require bids to be solicited.
- If purchase exceeds the small purchasing threshold, purchasing requests quotations through ITB, IFB, or RFP.
- The purchasing department receives and tabulates bid quotations.
- If bids are approved, the purchase order is processed and mailed.
- Vendor supplies the ordered goods or services, and submits the invoice to the purchasing department or to central finance/accounting.
- Receiving report is routed to central finance/accounting.
- Central finance/accounting verifies that the purchase order and invoice coincide (agree), and pays the invoice.
- Disposition of surplus, salvage, or scrap goods.
Purchasing cycle flowchart examples.
1See Lincoln University of Missouri, Purchasing Cycle,(November 2003) 1 and Blount County, Tennessee, Purchasing Policies and Procedures.