Invoice Requirements USA

Procure-to-pay is an essential concept in everyday business. It describes a step-by-step process involved in a single order cycle. In general, it is defined as the process by which an organization requests, purchases, receives, and pays for an item or service. For example, an organization that decides to purchase office stationaries would usually request for the items, send the request to the vendor, receive a shipment of items, and finally pay for the received items.

  1. Identify Need to be Procured
  2. Generate Requisition
  3. Approval of Requisition
  4. Purchase Order Generation
  5. Approval of Purchase Order
  6. Reception of Items
  7. Performance of Supplier
  8. Invoice Reconciliation and Approval
  9. Payment

The procure-to-pay process usually follows simple organizational steps. Each procurement cycle usually follows these steps. These are:

Identify Need to be Procured

This step is the first in the procurement process. It involves an inventory by individuals within an organization or a request for items from a department. All goods to be purchased are itemized, and the required type or specification is noted.

Additionally, a bit of supply management is carried out to connect the best suppliers with the required goods or services. This aspect of procure-to-pay usually involves some form of research by the procurement unit.

Generate Requisition

A formal requisition order is generated within the organization when an item is needed, which may be done by any employee within any department of the organization. The requisition is submitted to the procurement unit while considering all administrative requirements. Depending on the best practice, requisitions may be processed either as consignments or subcontracts.

Approval of Requisition

The procurement unit or officer receives the requisition and reviews it before making a decision. Depending on the outcome of the review, the officer may reject or accept a submission depending on the budget or need for the item. In other cases, the officer may request a review by the originator of the requisition to correct mistakes or include missing information before resubmission.

Purchase Order Generation

The moment the requisition is approved, the procurement officer produces a purchase order. The purchase order usually contains specific order information that defines all requirements for items such as specification and quantity. Also, a purchase order would often include options for a one-time or reoccurring purchase.

Approval of Purchase Order

The procurement officer sends the purchase order to the supplier for approval to prevent discrepancies. The supplier would usually go through the order against their inventory. Depending on the information on the purchase order, they may accept, reject, or modify the order. The outcome is communicated to the procurement officer of the buyer. If all parties are on the same page, a formal binding agreement is reached.

Reception of Items

When shipped items reach the buyer, the procurement officer or storekeeper receives the items into inventory. Each item should be inspected to guarantee that the right specification was received based on the agreed terms of the contract. Depending on the condition of the items, the officer either rejects or accepts the shipment. Accepted items are tracked and stored accordingly.

Performance of Supplier

Depending on the condition of the received shipment, the performance of the supplied goods is evaluated. This performance is assessed based on several factors: quality, transit time, complaisance, total cost, and more. The outcome is recorded for future use.

Invoice Reconciliation and Approval

The approved purchase order is compared with the invoice to guarantee that all figures match. In the absence of any discrepancy, the invoice is declared approved and passed on for payment. The presence of differences can lead to rejection of an invoice.


If everything goes accordingly, the last step of the procure-to-pay is the payment of the vendor. This step is also referred to as account payable. It involves sending payment to the supplier. Also, any clause within the contract concerning payment would be considered at this last point.


Procure-to-pay is essential within the procurement process, which involves several steps that begin with the identification of items, to purchase, and to final payment.