Enter_Purchase_Orders_Split_distributions

Enter Purchase Orders - Split distributions

 

When you create a purchase order (PO) that you know will eventually become an invoice split across multiple account segments (for example, GL accounts, departments, projects, funds) assigning a multiple split distribution set to that PO upfront gives you the same benefits you would have if you had assigned the split distribution set to the invoice, only now you're locking in your encumbrance and anticipated expense in the correct proportions. 

Here's why you would do this

  • Budget control. When a PO is entered, the amount is reserved against the selected GL account. If you know that, for example, a $20,000 equipment order will be split 50/50 between two projects, entering those two lines on the PO means $10,000 is encumbered to Project A and $10,000 to Project B, so neither project accidentally overspends. 

  • Accurate forecasting. By splitting the encumbrance, you can see in real time exactly how much each project's budget is tied up, rather than having a lump-sum encumbrance on a single account that you'd have to manually adjust later. 

  • One set split distribution. If you know from the start how the final invoice needs to flow through your general ledger/department/project codes, using the same multiple split distribution set on the PO and then on the matching invoice ensures they will line up perfectly. That means fewer manual adjustments or "split-match" hassles when the invoice arrives. 

  • Simplifies receiving and matching. Once the PO carries it's split distribution, any receiving transaction (or three-way match) will automatically reflects those splits—so the invoice match just picks up the same line items, with the amounts carried over, minimizing reconciliation work. 

  • Pre-built templates on POs. Suppose you frequently purchase supplies from Vendor XYZ and every time you split those supplies across three departments and two projects with set percentages. Instead of entering five separate lines each time you enter a PO, you attach that multiple split distribution set to the vendor. The system then automatically generates all five allocation lines, complete with the correct percentages or dollar amounts (relative to the PO total). You only have to confirm quantities, item details, pricing, and so on, instead of building the five lines from scratch. 

  • Reduces data-entry errors. If someone forgets to add one of the necessary distribution lines to the PO, your encumbrance and subsequent invoice match will be off. A predefined distribution set prevents that from happening. 

 

 

Example

  • Multi-department equipment purchase. A $50,000 server order that needs 60% to IT (GL 5400), 25% to Data Analytics, and 15% to Capital Renovation (GL 7000).

  • Inter-project services. Ordering consulting services that will be split 40% to Project Alpha, 35% to Project Beta, and 25% to an R&D grant. 

  • Campus utilities or lease commitments. A PO for annual utility contracts that must be divided among four buildings (each tied to different departmental budgets). 

  • Shared license purchases. A software license renewal you know will serve three different cost centers (for example, 50% for Design department, 30% for Marketing, and 20% for Training).

 

 

In this section: 

How do I set up a vendor with a split distribution?

How do I enter PO detail using Split mode?

Enter Purchase Orders - Split distributions

 

 

 

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