Purchase Order vs Transfer Order

Purchase Order (PO):
Company will issue to Vendor to purchase materials.

 

Transfer Order (TO):
Company's one plant will issue transfer order to another plant to transfer stock. Stock will be transfered from one plant to another plant. TO which means Inter Company.

End to end process for trans. order means..issuing plant has to confirm to receiving plant that it has issued transfer order successfully. Issuing plant stock level in inventory has to be decreased. Receiving plant has to confirm that it has received tranfer order successfully. Receiving plant stock level has to be increased.

PO's are the documents which are used to procure materials externally from external vendors or third party vendors. Whereas STO's are the documents which are internal between the company codes (Plant to Plant transfer) called as Cross company STO's and Plant to Plant transfer under the same company code (Intra company STOs.)

Invoice or the inventory verification/Quality check is not applicable for STO transactions.