Saturday, February 16, 2008

Approval Hierarchy in Purchasing

Oracle Purchasing offers three methods to route documents for approval.. Yes, you read it right ! it's three !!

1. Position Approval hierarchy
2. Employee/Supervisor approval hierarchy
3. Advanced Approval Support for Requisitions

1. Position Approval hierarchy
Position Hierarchies are hierarchies that have a position relationship. By position, we mean position that are attached to employees. Purchasing utilizes positions as a roadmap to determine how and where documents will be routed once the approval process has been initiated. It is first necessary to have created all positions that are going to be used in the system. Once all positions have been created, it is necessary to build the position hierarchy. Each position has approval limits, so when a purchase order exceeds the limits of the position, the purchase order is forwarded onto the next position in the Hierarchy.

2. Employee/Supervisor approval hierarchy
Employee/Supervisor approval hierarchy uses the employee-supervisor relationships.
To implement this form of approval routing, you need only to define jobs. The job will then serve as the tie to the Approval group, and based on the approval limits from the Approval Group, the Document will either be Approved or Forwarded to the Employees’ Supervisor. If no Supervisor is able to be located and the jobassigned to the employee does not have Approval Authority, then the Approving employee must enter a Forward-to person, or the Document will be returned to an Incomplete status and a notification will be sent to the Approving employee, stating - 'No Approver Found'

3. Advanced Approval Support for Requisitions
Feature offered in Release 12 which closely integrates with Oracle Approvals Management module.

How to determine which approval method is setup?
Navigate to Financial Options (Purchasing --> Setup --> Organizations --> Financial Options)
The Human Resources tab on the Financial Options form has an option called "Use Approval Hierarchies". This option determines which type of hierarchy is used for the approval process. When checked, the Position Hierarchy is used and when unchecked the Employee/Supervisor relationship (i.e. Jobs) is used


  1. Hi All,

    I have tried Employee/Supervisor relationship for purchase order approval as per your directions. (Disabled use Approval Hierarchy and defined only JOB). But, the PO created by employee is getting approved though the amount is beyond his limit.

    If anybody send me screenshot that would be help for me to find out where i went wrong or correct me where i went wrong.

  2. Hi All,
    I have set up Position Approval Hierarchy, but there is some tolerance in the Amount Limit when sending PO documents for Approval. So when an employee with Amount Limit of 50 000 EUR send a purchase order for 47 000 Eur, the purchase order is sent to the nex approver in the hierarchy. I have checked "Owner can approve" checkbox.

    I suppose there must be some tollerances, but i cannot find them.

    Thank you in advance!


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