What is a purchase requisition?

A purchase requisition is fundamentally an internal document used within an organization to formally request the procurement of goods or services. This document serves as a crucial communication tool between the department needing the items and the purchasing department. It provides detailed information such as the type and quantity of items required, specifications, and the desired delivery date.

The requisition initiates the purchasing process by ensuring that requests are properly documented and approved before any purchasing action is taken. This process helps maintain control over spending and ensures that the organization adheres to budget constraints and procurement policies.

In contrast to the other options, a document recording sales transactions relates specifically to the sales side of the business rather than the purchasing side. A report on inventory levels assists in tracking current stock but does not act as a request for purchasing goods. Finally, a contract with suppliers outlines the terms of a purchase agreement but presupposes that the purchasing process has already been initiated, whereas a purchase requisition is the first step in that process.