Policy Steward: 
Director of Vendor Payment Strategies
Format Updated: 
University Policy & Standards Converted: 
Revision Date: 
Friday, March 11, 2016

* This information replaces FIS 405 Purchase Orders and Encumbrances & FIS 801-07 & 801-08 for Fiscal Year End Processing of Purchase Orders & Manual Encumbrances


Signature Authority

See PaCS 202-004: Contract Signature Authority  in the Procurement and Contract Services (PaCS) manual for personnel authorized to sign a contract on behalf of the University.


Processing a Purchase Order

In Banner Finance, Purchase Orders and Invoices are called documents. Document Level accounting allows use of one or more accounting distributions, i.e. FOAPALs, to pay for one or more commodities as a percentage (or other distribution) of the total charge. Document Level accounting is more commonly used than Commodity Level accounting.

Commodity Level accounting allows assignment of one or more FOAPAL to each specific commodity. Commodity Level accounting might be used by a Dean’s office to purchase several items from one vendor for several different units. Commodity Level accounting must be used when the 40101 (capitalized equipment) account code is used so the information will feed into the fixed asset module of Banner properly.

A purchase order can be processed for each purchase greater than $5,000 that is made by the university and is not charged to an Auto Pay vendor.  The Banner FIS Purchase Order (PO) specifies commodities ordered from a specific vendor, and the price, terms, and conditions of that order.  Unit personnel or PaCS enters the PO using the FPAPURR screen in Banner.  The entry includes accounting data that automatically creates needed encumbrances against the unit’s accounts.  Purchase Orders of $25,000 or more are required to be processed through PaCS. 

Information specific to equipment purchases may be found in PRO 202: Purchases.

Ship to Codes/Buyer Codes are maintained by the PaCS.



Encumbrances are automatically created when a Purchase Order is completed and approved in FIS Banner.  The encumbrance is automatically liquidated when a regular pay invoice is completed and approved, referencing the Purchase Order number.  If “F” Final is selected when paying, the PO is closed.


Liquidating a Purchase Order

A purchase order is liquidated by referencing the PO number during payments.  If for some reason the Purchase Order has not been completely liquidated by this process, a liquidating Journal Voucher must be created in FGAJVCD.


Establishing an Encumbrance without a Purchase Order (Manual Encumbrances)

Manual encumbrances can include airfare, travel reimbursements, supplies, printing, GRA/GTA tuition and indirect costs.  Use Banner form FGAENCB to make a manual encumbrance

Manual encumbrances are set up, maintained and liquidated by the Office for Sponsored Research and Award Administration (OSRAA) for all sub-grants and subcontracts.  See FIS 1106-09 Payment of Grants and Contracts Sub-Award Invoices with Encumbrance  for processing subcontractor invoices with these encumbrances.


Liquidating a Manual Encumbrance

Any encumbrance set up on FGAENCB needs to be manually liquidated (or in some cases, readjusted) once the actual expense is incurred.  This is done via a journal voucher on FGAJVCD – Journal Voucher Entry Form, and rule code 2LIQ.  Any manual encumbrances remaining for subcontracts after the final payment to the vendor/subcontractor will be liquidated by OSRAA.


Training Offered by Financial Accounting & Analysis/Business Affairs

OSU Professional Development Central Registration


Each year, the Office of Business Affairs distributes Year End Closing instructions with specific dates and deadlines for that year.

Fiscal Year-End Processing

Effective Date: Wednesday, January 1, 2003

Revision Date: Thursday, December 9, 2010

Purchase Orders
  1. See the current year’s schedule for purchase requisition deadlines.
  2. See the schedule for the date that Period 01 of the next fiscal year is open for entry of new fiscal year purchase orders and   encumbrances.
  3. Purchase orders remaining “open” at the end of the current fiscal year period 12 will be rolled into period 01 of the new fiscal year accounting records.  It is critical that the “open” purchase orders are indeed “open” and do not include those for which final payment has already occurred. 
  4. Before the last Friday in June, please use the FGROPNE report to locate all purchase orders for which final payment has already occurred.  These encumbrances should be liquidated with a JV.  By the time and the date specified in the current year schedule, verify that all completed current year purchase orders are closed.
Fiscal Year-End Processing of Manual Encumbrances

Manual encumbrances (“E” documents) remaining in the current fiscal year accounting records will be rolled into the new fiscal year accounting records.  Therefore, all manual encumbrances must be correct on the last working day in June.