BLANKET OR STANDING PURCHASE ORDERS

Material & Disbursement Services (MSD)

PROCEDURE 2

Effective Date: 03/01/1998

Last Modified Date: 02/17/2004

Procedure Description

A Purchase Requisition to establish a standing order arrangement for supplies from a vendor may be used to eliminate the need for repeated Purchase Requisitions. Since all standing orders are subject to the rules of competitive procurement, each request for a single-source standing order must be justified (see MSD Policy 7, Single-Source or Brand-Specific Purchases).

Procedure Steps

Estimate the Cost

1. The standing order must be requested for a specific amount. The total estimated cost will be encumbered against the account shown.
2. Outstanding encumbrances on standing orders written against State funds revert to the State at the end of the fiscal year, so request only sufficient funds to cover anticipated purchases.
3. A Change Request (Form P-103) may be used to terminate a standing order. The outstanding balance will be liquidated, freeing the funds for other purposes.

Submit a Purchase Requisition

4. Information specific to a standing order includes
   • Block 4/Date Needed—Type "As required" here.
   • Block 17/Description—Describe the supplies to be covered by the standing order. Include a statement with wording similar to this:

   This is to establish an standing order for furnishing miscellaneous [type of commodity (e.g., animal feed)] items as authorized and called for by [name of authorized person] of the [requesting department name] during the fiscal year period ending June 30, [year], in the amount of [$ dollar amount].

5. Materials cannot be shipped against this order beyond the period indicated, nor can materials be shipped in excess of the dollar amount. Materials are to be invoiced as delivered.

Purchase Order Processing

6. Purchasing Services will issue a Purchase Order to the vendor based on the information submitted on your Purchase Requisition.
7. A copy of the PO will be sent for your departmental files.
8. Once the PO has been issued, any changes must be made through Purchasing.

Place the Order

9. Place orders for supplies directly with the vendor. Be sure to give explicit shipping instructions.
10. Give the applicable PO number to the vendor with each request.

Changing a Standing Order

To make any changes on a standing order, including increasing the amount, complete a Change Request and send it to Purchasing.

Terminating a Standing Order

• When a final invoice is received from the vendor, mark the invoice "Final." Once payment has been issued, any remaining balance will be liquidated.

  OR

• If all invoices have already been submitted and paid, complete and submit a Change Request. Purchasing will then close the order and liquidate any remaining balance.

Additional Information

See also:

MSD Policy 7, Single-Source or Brand-Specific Purchases

MSD Policy 10, Blanket or Standing Purchase Orders

MSD Appendix 1, Purchase Requisition

MSD Appendix 2, Justification Memorandum

MSD Appendix 8: Purchasing Change Request

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