Work orders are internally generated company documents to authorize specific work. They can be generated by the sales department in connection with a purchase order or by any other department requiring specific work.
Function
Work orders serve to initiate work, clarify the work to be done, the delivery date and special instructions. Work orders are also used to track the progress of the work.
Features
Each work order contains full contact information of the individual generating the work order, the customer or company sales rep if part of a project, details of the work to be done, benchmark dates and delivery instructions.
Benefits
Use of a work order system guards against overlooked requests for work to be done and makes it easier to schedule workload, hiring needs, timely ordering of supplies and materials, manufacturing, packing and shipping. Efficient scheduling improves cost accounting and saves a company money.
Significance
Work orders provide a record of business activity that can be accessed for budget planning purposes and in the event of legal proceedings.
Considerations
Work orders form the basis for invoices but generally do not qualify for factoring since they are usually just internal organizational systems and not legal promises to pay as are purchase orders.
