Purchase order best practice is a short list, and the useful way to present it is by what each rule prevents. Every one of them addresses a failure that is invisible when it happens and expensive weeks later, which is why they are so often skipped: nothing goes wrong at the time and the consequence lands on somebody else.
Unique numbers, never reused
Prevents two transactions becoming permanently indistinguishable in every downstream record. Manual schemes break under pressure, usually when two people raise orders simultaneously or a file is restored from an older copy, and there is no retrospective repair once two orders share a number.
Approval before the order is issued
Prevents approving a commitment that already exists. Once a supplier holds an order and acts on it you are generally committed, so approval afterwards is a review rather than a decision. Making the process fast enough that approval-before-issue survives is the practical work here.
Receipts recorded at the delivery point
Prevents an invoice arriving with nothing to check it against. This is the rule most often broken because it belongs to operational staff who are measured on other things, and its absence is the commonest single cause of an aged exception in payables.
Agreed entity, units and price basis
Prevents a recurring mismatch on every invoice from that supplier. The legal entity that will invoice you, the unit of measure they bill in, and whether the price includes delivery and tax are each settled once at supplier setup and cause permanent exceptions when assumed instead.
Questions people ask about purchase order best practices
Should every purchase have an order?
Most organisations set a threshold with explicit exceptions for categories where pre-ordering is impractical. Setting it deliberately beats leaving people to guess.
How do we handle amendments?
As dated revisions rather than overwrites, resent to the supplier, with re-approval above a defined increase so orders cannot grow past their approved value one change at a time.
When should an order be closed?
When received and invoiced quantities reconcile with ordered, or when somebody decides the balance will not arrive and records the reason.
What does an order number actually do?
It connects the order, the delivery note, the invoice and the payment into one traceable transaction. Every one of those documents becomes harder to reconcile the moment the reference is missing or wrong, which is why suppliers are asked to quote it.