How to Create a Purchase Approval Log

A purchase approval log is a shared record of what someone wants to buy, who reviewed the request, and what happened next. A simple spreadsheet can help a small business plan spending, find missing receipts and keep sales-tax records organized, provided it fits the way the business actually buys things.

Decide what the log will cover

Start by defining which purchases need to be recorded. You might log every business purchase, or only requests that need approval before an order is placed. For a small operation, recording planned purchases above an internal threshold, recurring commitments, equipment, and unusual or urgent orders can make the log manageable. Whatever you choose, write the scope at the top of the sheet so staff apply it consistently.

A purchase approval log is not a substitute for an accounting system, purchase order, supplier invoice, receipt, or tax advice. It helps connect those records. Give every request a unique ID, such as PA-2026-001, and use that ID in the purchase order filename or receipt notes where practical. Keep original invoices and receipts in an orderly, access-controlled folder or accounting system; the log should point to them, not replace them.

Before setting up fields, decide:

• Who can submit a request?
• Who can approve it, and who is an alternate when that person is away?
• At what stage does approval have to happen: before an order, a subscription renewal, or a reimbursement?
• Which purchases are excluded, such as routine bills already covered by a standing budget?
• Where will supporting documents be stored, and who can see them?

These are internal workflow choices. A business may have separate obligations under its contracts, funding arrangements, accounting policies or applicable laws. A log alone does not establish compliance.

Choose a format that people will maintain

For a sole proprietor or a small team, a spreadsheet is usually enough to begin. Create one row per request, use consistent date and status formats, and protect formula cells if the spreadsheet supports it. Keep one controlled copy in a location the relevant staff can reach. Avoid sending around multiple editable copies: conflicting versions make it hard to know which decision is current.

A paper form can work where staff do not reliably have access to a shared computer. Number the forms and enter the decisions into a central register at a regular interval. If purchasing volume grows, several people need to approve in sequence, or the business needs automated reminders and audit history, consider an accounting, procurement or workflow application. Confirm that the chosen system can export records and retain the supporting documents you need before moving the process into it.

Format	Useful when	Watch for
Spreadsheet	One location, a few requesters, straightforward approvals	Accidental edits, duplicate copies, weak access controls
Numbered paper form plus register	Staff work offline or have limited device access	Delayed entry, lost forms, illegible handwriting
Workflow or accounting software	Requests need routing, reminders or a searchable history	Setup effort, access permissions, export and retention limits

A format is only useful if it is accessible to the people who must use it and can be maintained by someone responsible. Start with the least complicated option that can preserve a clear decision trail.

Add the essential fields

Use a single header row and avoid packing several facts into one cell. The following fields cover the request from planning through reconciliation:

• Request ID and dates: unique ID, date submitted, requested purchase date, and date of final decision.
• Requester and purpose: the staff member or owner making the request, team or location if relevant, and a short business reason.
• Supplier and item: supplier name, product or service description, quantity, and a quote or product reference.
• Estimated amount: expected subtotal, freight or other charges, estimated tax, and total. State the currency if the business buys in more than one currency.
• Budget and category: budget line or spending category, plus whether funds are available. A planned cost is not automatically an approved budget.
• Decision: status, approver name or role, decision date, and a brief reason for approval, rejection, or a request for changes.
• Order and receipt: purchase order or order number, actual amount, order date, delivery or service date, and the person confirming receipt.
• Records and follow-up: links or file references for the quote, invoice and receipt; payment or reconciliation status; and any exception or follow-up needed.

Use a small set of controlled status values, such as Draft, Submitted, Needs information, Approved, Rejected, Ordered, Received, and Reconciled. Define what each means. For example, “Approved” should mean permission was granted to proceed, not that the item has arrived or the invoice has been paid.

Keep estimates separate from actuals

Do not overwrite the original estimate when the final invoice differs. Keep estimated and actual amounts in separate columns, and note why a material difference occurred. That makes the record useful for future budgeting and makes it easier to spot changes that need another decision under the business’s own rules.

Set approval rules before the first request

Write down who may approve each category or amount range. Keep the rules short enough that requesters can apply them without guessing. A simple policy might require an owner’s approval for all non-routine purchases, while another business might assign approvals by budget and category. There is no universal threshold suitable for every business; choose one based on cash flow, risk, budget size and how much oversight the owners want.

Set a few safeguards:

1. Separate requesting and approving where practical. If a very small business has only one decision-maker, record that person’s approval and the reason rather than pretending there is a second reviewer.
2. Do not split a purchase to avoid an approval limit. Treat related items or a single project as one planned commitment when applying internal thresholds.
3. Require a fresh decision when key details change. A new supplier, materially higher cost, different item, or changed business purpose may alter the original request.
4. Define urgent purchases. Specify who may act in an emergency, what evidence to retain, and how soon the request must be documented afterward. Do not use urgency as a routine shortcut.
5. Record conflicts and alternatives. If an approver is also the requester, note that fact and follow any alternate review process the business has established.

If a request is rejected, retain it with the reason and date instead of deleting it. If more information is needed, return it to the requester with a specific question and leave the decision pending. A visible history reduces repeated requests and helps explain why planned spending changed.

Include useful sales-tax information

For planning and bookkeeping, separate the estimated pre-tax amount, tax estimate and expected total. A supplier quote may show taxes separately, include them in a total, or leave them for the final invoice. Record what the quote actually says; do not infer a tax amount from an unclear price. For purchases involving different tax treatments, a line-item breakdown may be more useful than a single estimate.

In a British Columbia business, tax collected or charged can depend on the transaction and the business’s circumstances. Do not hard-code a rate in the log or assume every purchase receives the same treatment. Enter the tax shown on the supplier’s invoice when it arrives, preserve the invoice, and have the person responsible for bookkeeping classify it under the business’s accounting process. Whether tax can be recovered, how it should be reported, and which rules apply are questions for current official guidance or a qualified tax professional; a purchase log cannot determine them by itself.

Useful tax-related fields include:

• quoted tax amount, if stated;
• actual tax amount from the invoice;
• tax description or code as shown by the supplier, where relevant;
• invoice reference and invoice date; and
• a bookkeeping review or reconciliation status.

If the supplier’s invoice does not match the quote, record the difference and ask for clarification where needed. Keep the invoice and any corrected document together. Do not edit the supplier’s document or use the log to conceal a discrepancy.

Process a request from submission to closeout

A consistent sequence helps the log remain useful after approval:

1. Submit the request. The requester enters the purpose, item, supplier, quote, estimated total and requested date. The request stays in Draft until it is ready for review.
2. Check completeness and budget. The reviewer confirms the business purpose, available budget, estimated total, supplier details and supporting quote. Return incomplete requests as Needs information.
3. Record the decision. The authorized approver records a dated approval or rejection and any conditions. Approval should identify the amount and scope authorized, especially when the quote has options or exclusions.
4. Place the order. After approval, enter the order number and date. If the final order differs from what was approved, pause and seek whatever revised authorization the internal policy requires.
5. Confirm receipt or service. Record who checked delivery or completion and when. Note shortages, damage, partial delivery or unresolved service issues, and retain relevant correspondence.
6. Match and reconcile. Compare the invoice to the approved request, order and receipt. Record actual subtotal, charges, tax and total, attach or reference the invoice and receipt, and flag any mismatch for review.
7. Close the record. Mark it Reconciled only when the business’s designated reviewer has completed the matching and follow-up. Keep rejected, cancelled and partially fulfilled requests with an accurate final status.

This sequence works for a spreadsheet or a software workflow. Adapt it for subscriptions or recurring services by recording the commitment period, renewal date, cancellation terms reference and person responsible for reviewing renewal. A recurring charge can continue after the original approval, so schedule a review before renewal rather than treating the first decision as permanent authorization.

Make the log easy to use and review

Use filters for status, requester, supplier and month. Freeze the header row, make dates consistent, and use dropdowns for statuses and categories if the tool supports them. Avoid merged cells, decorative formatting that hides data, and formulas that depend on staff typing values in a precise way. A short instruction note can define each status and identify the person who maintains the register.

Limit access to people who need to submit, approve or reconcile purchases. If the tool has version history, retain it; if not, store periodic dated copies according to the business’s recordkeeping process. Set a naming convention for linked files, such as PA-2026-001_quote.pdf and PA-2026-001_invoice.pdf. Do not put payment card numbers, passwords or unnecessary personal information in the log.

Review open requests on a regular schedule that suits the business’s purchasing cycle. Look for requests awaiting information, approved items not yet ordered, orders not marked received, missing invoices and unexplained differences. A short review is more useful when each open item has an owner and next action.

Troubleshoot common problems

The same request appears twice. Search by requester, supplier, description and date before creating a new row. If it is a duplicate, mark it as such and link it to the active request rather than erasing the history.

A purchase was made before approval. Record what happened accurately, preserve the invoice and reason, and route it for the business’s documented exception review. Do not backdate an approval or label an unapproved purchase as approved. Repeated exceptions may indicate the policy or process needs adjustment.

The invoice is higher than the approved estimate. Record the actual total in its own fields, identify the cause, and check the internal rules for a revised approval. Freight, substitutions, exchange rates or scope changes can explain a difference, but the log should show the evidence and decision.

A receipt or quote is missing. Ask the requester or supplier for a copy, note the missing document and follow-up owner, and leave reconciliation open until the business’s process permits it to close. Do not make up a document reference.

A staff member cannot edit the shared file. Check access permissions and whether they opened the current central copy. Provide a simple submission route for people without direct editing access, and have the log owner enter the request promptly.

Know the limits and keep the process current

A log cannot guarantee that a purchase is wise, affordable, tax-deductible or eligible for a tax credit. It also cannot prove that goods were received, establish supplier quality, or replace bank reconciliation and financial statements. Those checks require the underlying documents and the business’s normal accounting controls.

Review the fields and approval rules when the business adds staff, changes its budget process, adopts new software, or begins buying from new suppliers or in other currencies. Remove fields that no one uses, but retain the information needed to trace a decision from request to invoice. The best log is a modest, consistent record that makes the next action clear and preserves enough context to understand the purchase later.