CAV Budget-Controlled Purchasing

The purpose of the budget-controlled procurement is to use the budget as an on-line operational tool rather than just a post factum report and analysis tool.
The system combines three elements:

  1. Budget
  2. Procurement system
  3. Bookkeeping system

The system’s goal is to prevent the budgetary framework from being exceeded in practice.
This is carried out through integration of the budget in the procurement system. Requests for procurement require electronic signatures, as defined by the system manager; and are checked on-line against the budget, actual expenses and other authorized procurement requests.
This can be implemented on several levels:

  1. One-to-one: budget item = expense item
  2. Many-to-one: several expense items are concentrated into single budget item
  3. One-to-many: budget item is allocated at additional levels: cost centers, branches, departments, etc.

The procurement requests and orders can be implemented in the following manners:

  1. A request for each order.
  2. Combining orders for a single item and then distributing the cost among a number of budget items (by percent).
  3. A number of requests for one order.
  4. One request divided into a number of orders (by percent).