A purchase order (PO) is a commercial document issued by a buyer to a seller (supplier), indicating types, quantities, and agreed prices for products or services the supplier will provide to the buyer. Sending a purchase order to a supplier constitutes a legal offer to buy products or services. Acceptance of a purchase order by a supplier usually forms a one-off contract between the two.
A buyer or purchasing agent is a person who purchases goods and services for an enterprise.
A purchase order document allows buyers to communicate their intentions clearly and explicitly to suppliers. Suppliers are protected in case of a buyer's refusal to pay for goods or services.
A purchase order document is the last step of the procurement cycle. The PO is a contract detailing the deliverables and timeline to a supplier. The purchase order document is the only transaction that allows receipts (of goods and services) to be transacted.