Financial Management & Digital Accounting · Intermediate level

Intermediate level · Module 4: Financial Controls and Fraud Prevention · Lesson 2 of 3

Authorisation and Procurement Controls

Ensure money is spent only on approved purposes at fair prices.

In this lesson you will

  • Set authorisation limits
  • Apply simple procurement controls

Key concepts

authorisation limitsquotationspurchase ordersgoods received

The lesson

Authorisation limits state who can approve what: a manager up to a set amount, the director above it, the board for very large purchases.

Procurement controls include written quotations from several suppliers above a threshold, purchase orders and a goods received note before payment.

Match the purchase order, goods received note and invoice before paying — the 'three-way match'.

Step by step

  1. Draft authorisation limits.
  2. Set quotation thresholds.
  3. Design a simple purchase order and goods received note.
  4. Test a three-way match.

Practice activity

Write authorisation and procurement procedures for the NGO.

Expected result: Practical procedures with limits, thresholds and matching.

Check your understanding

  1. What is a three-way match?

    Show answer

    Matching the purchase order, goods received note and invoice before paying.

  2. Why require several quotations?

    Show answer

    To obtain fair prices and avoid favouritism.

Taught live by an instructor — online or in person. Free course lessons are for self-study and do not lead to a certificate — see registration options.