# How purchase approvals work (/docs/purchasing/approval-ladder)
Every requisition and purchase order passes a ladder of approval levels. Which levels apply depends
on the document, its purchase type and its value in RM. This page is for approvers and for the
organization admin who sets the rules.
## Which levels apply [#which-levels-apply]
These are the default rules. Open **Purchasing** settings (`/purchasing/cfg`), tab **Approvals**, to
see or change your organization's rules.
| Document | Purchase type | From value (RM) | Approval level | Default approver |
|---|---|---|---|---|
| Requisition | Any type | 0 | Department head | Hafiz Rosli (supervisor) |
| Requisition | Production | 20,000 | Purchasing review | Lim Wei Jie (buyer) |
| Requisition | Project | 0 | Engineering review | Daniel Tan (engineering) |
| Purchase order | Any type | 0 | Purchasing approval | Lim Wei Jie (buyer) |
| Purchase order | Production | 50,000 | QA review · new or critical material | Grace Ooi (QA manager) |
| Purchase order | Project | 0 | Engineering review | Daniel Tan (engineering) |
| Purchase order | Any type | 100,000 | Managing director | Lee Chong Ming |
Every rule that matches the document applies. A production requisition is valued at the item's last
PO price. A project requisition is valued at its budget. A purchase order is valued at quantity
times unit price, or the contract value.
```mermaid
%% title: Approval ladder for a RM 120,000 production purchase order
flowchart LR
A[Submitted] --> B[Purchasing approval]
B --> C[QA review · new or critical material]
C --> D[Managing director]
D --> E[Approved]
```
## Read the approval strip [#read-the-approval-strip]
Every requisition and purchase order has an **Approval** strip. It shows `{n} of {m} signed` and one
row for each level.
| State | Meaning |
|---|---|
| **Signed** | The level was signed, with the date and time. |
| **Waiting** | This level can sign now. |
| **Pending** | An earlier level has to sign first. |
| **Not required** | The value is below the level's threshold. |
| **Escalated** | The level was passed on without a signature. The row says `over limit` or `requester`. |
If no level applies, the strip says "No approval levels apply at this value".
## Signing order and who signs [#signing-order-and-who-signs]
The signing order is set for each document type under **Approvals**:
- **Sequential**: levels sign one after another, lowest threshold first. This is the default.
- **Parallel**: every level that applies can sign at the same time.
A level can have more than one approver. **Any one** means one signature is enough. **All** means
every approver signs.
Six rules always hold:
1. The requester never approves their own requisition. If the requester holds a level, it is
passed on and marked **Escalated** with `requester`.
2. Whoever created a purchase order, or set or changed its supplier, quantity or price, never
approves it. This holds at every level, in person and as someone's delegate. Another approver
signs it.
3. One person cannot sign two levels of the same document.
4. The last level must be signed within the signer's approval limit.
5. A rejection needs the same authority as an approval. Only someone who holds an open level can
reject.
6. A purchase order is approved on its own amount (quantity times price). The approval of its
requisition never stands in for it, so an order that is larger than the requisition, or priced
when the requisition was not, goes through every level its own amount reaches.
## Approval limits and delegation [#approval-limits-and-delegation]
An approver can have a limit in RM. A signature above the limit moves to the next level and the
level is marked **Escalated** with `over limit`. The last level has nowhere to go, so the system
refuses and asks for a higher level.
The organization admin sets limits and delegates under **Settings > Entities & access**
(`/config/people`): **Approval limit (RM)**, **Delegate**, **From** and **To**. During a delegation
window the delegate signs on behalf and both names are recorded.
With the default permissions, planner, engineering and the managing director can only view
Purchasing. If you hold a level but cannot sign it, ask the organization admin to give you full
access to Purchasing, or to delegate the level. The organization admin can sign any level.
## Owner self-approval [#owner-self-approval]
In a small team the Managing Director can be the only approver. When the Managing Director raises a requisition, nobody else can approve it. The **Owner self-approval** setting lets the Managing Director approve their own requisition.
1. Open **Settings › Approvals**.
2. In **Purchase approvals**, turn on **Owner self-approval**. Only the Org admin can change it.
The setting is off by default. When it is on:
- It applies to requisitions only. Purchase orders still need another approver.
- It applies only at a level where the Managing Director is the approver.
- The Managing Director must sign in person. A delegate cannot use it.
- Every other requester is still refused.
- The activity of the requisition shows "Self-approved by the Managing Director under the owner self-approval setting". The audit log records each change to the setting.
ISO 9001 and ISO 13485 clause 7.4 require control of purchasing, not a second person. Record the reason for the setting in your quality manual.
## If the system refuses [#if-the-system-refuses]
The approval messages are in [Purchasing refusals](/docs/purchasing/refusals#approval-ladder).
Examples:
- `{name} can approve up to RM {limit}. This goes to {level}.`
- `{name} has already signed this document. {level} must be signed by another approver.`
- `{key} can be rejected only by an approver of {level} ({names}).`