Purchase order (PO) – what, why and how?
At DTU, a Purchase Order (PO) is generally required for all purchases. This page explains what a PO is, why it is important, and in which limited cases exceptions may apply.
What is a Purchase Order (PO)?
A purchase order, abbreviated PO, is an order created in DTU's system before purchasing goods or services. It is sent to the supplier as a confirmation of the order.
A PO serves as a pre‑approval of the purchase and helps ensure that:
- the expense is budgeted
- the price, supplier selection and account coding are correct before the purchase is made
- finances are managed properly at project and unit level
A PO constitutes the actual order and functions as both an internal and external reference used by DTU and the supplier. The invoice is the bill that is sent after delivery.
When the invoice is matched with the PO, it becomes easy to verify that the price and content correspond to what was ordered.
Why do you always need to create a PO?
- Strengthens budget compliance – the expense is pre‑approved and visible in the project’s or unit's finances
- Ensures traceability – the link between order and payment can always be followed
- Improves control – makes it easier to verify that the invoice matches the order
- Reduces errors – minimizes the risk of duplicate payments and incorrect suppliers
As a general rule, a PO must always be created for purchases made at DTU.
When is a PO NOT required?
In a few specific cases, a PO does not add value or it is not practically possible to create one. Read about the exceptions to the PO requirement .
Important
- A PO is not the same as an invoice
- The invoice must always match the created PO
- A PO is only valid once it has been approved in the system