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Procurement & Contracts - Purchasing Process

Purchase Orders

A purchase order is a legally binding agreement issued to a vendor for the acquisition of goods and services. The purchase order specifies price, quantity of an item, payment terms, delivery dates, freight, and all other obligations and condition related to the purchase.

The following types of Purchase Orders are used at American University:

Standard Purchase Orders


Blanket Purchase Order

Change Orders

University Services

Standard Purchase Order - (PO) clearly identifies a supplier and the scope of the particular goods and services to be purchased. At minimum it should include the supplier’s name, date of the PO, date of delivery, manufacturer, model number, quantity and line items, pricing information and signature of an authorized buyer within AU. A reference to the acceptable Terms and Conditions that are applicable to the PO and an unsigned proposal or Statement of Work by the vendor should be adequate for most PO requirements at AU.

Prepayment - When payment is made by a University check BEFORE services are rendered. Typically, AU contracts with suppliers who use net terms or expect payment AFTER services are rendered. However, occasionally a situation may arise when a check must be presented upon receipt of goods or prior to receiving the items or services ordered. To request a prepayment PO, the PR must state clearly that payment be made in advance, with all supporting documentation attached (order form, quote, Performa bill, etc.). Typically postage, conference or subscriptions, or other one-time, up-front purchases are included in this category. Also see direct pay of invoices above.

Purchase orders can be transmitted to a vendor by mail, fax, e-mail, and by hand delivery in instances where materials need to be delivered quickly to AU, or when delivery is not appropriate. The requisitioner will acknowledge the PO when picked up. The acknowledgement will suffice for Accounts payable to pay the invoice.

Blanket Purchase Order

Should be used for:

  • repeat purchases from a particular supplier of goods or services that may include multiple shipments;
  • purchases with volume requirements that yield additional discounts (terms should be attached to the PO);
  • purchases requiring multiple payments;
  • leasing office equipment; or
  • a maintenance agreement for goods or services; other items to be identified.

Blankets purchase orders should include:

  • the period of time for the performance;
  • clear indication of the purpose of the blanket;
  • Not To Exceed amount for the blanket;
  • scope of goods or services to be included, or not; and
  • person authorized to issue releases against the blanket.

After a blanket purchase order is issued, the department's responsibilities include:

  • placing the order to the company using the Blanket PO number as reference;
  • arranging delivery; and
  • approving the invoice and forwarding to Accounts Payable according to the following:
  • if the amount is fixed, the dean or department head will need to authorize automatic payment;
  • if the amount is fixed, and the requisition indicates a fixed price over a fixed number of months, no further approval is needed;
  • invoices not returned within 15 days and $500 or less will be processed for payment;
  • and the correct blanket PO number must be clearly visible on the invoice.

At the end of the fiscal year, all blanket purchase orders will be closed. Any money remaining encumbered will be automatically released into the respective budget that requested the blanket. Each department is responsible for the re-issuing of all blanket orders for the following fiscal year, unless prior approval is given by the department to extend the expenditures for certain agreements. New blanket purchase orders will reference the old blanket numbers and state the new Not to Exceed amount on the orders.

Change Orders - To request a change to a previously issued purchase order, a purchase requisition and appropriately authorized e-mail or fax containing the original PO number, PR number and supplier is required. Upon receipt of the authorization, PCD will contact the supplier to make the necessary changes. If the order can be changed, a modification to the original PO will be issued. In the event the item has already shipped, PCD will communicate the alternatives available to the end user. To increase an amount on a blanket purchase order, a request by e-mail to the buyer is required.

University Services - Department’s budget coordinators, or those authorized may purchase services from on-campus-approved suppliers such as Bon Appetit and the UPS Store. The Campus Retail Purchase Order is available on Accounts Payable section of the AU portal and can be used to purchase University Services. (Many on-campus vendors also accept the One Card). Please contact the establishment directly for specific instructions on how to order on your budget.