The Procurement Glossary » Procurement Compliance

Procurement Compliance

Compliance & Risk

Definition

Adherence to the policies, contracts, laws and controls that govern how an organisation buys.

Explanation

Compliance spans internal policy (using approved processes and suppliers), contractual terms, and external regulation. It protects against overspend, fraud, legal exposure and reputational harm, and is enforced through controls, systems and audit.

Example

A compliance review checks that purchases used approved suppliers, valid POs and proper approvals.

Related terms

• Policy Compliance — The extent to which actual buying behaviour follows the organisation's procurement policy.
• Contract Compliance — The extent to which actual buying follows the prices, terms and preferred suppliers set in contracts.
• Internal Controls — The policies, procedures and system checks that safeguard assets, ensure accurate records and prevent fraud.
• Audit Trail — A complete, time-stamped record of the steps and approvals in a transaction, showing who did what and when.

Frequently Asked Questions

What is Procurement Compliance?

Adherence to the policies, contracts, laws and controls that govern how an organisation buys. Compliance spans internal policy (using approved processes and suppliers), contractual terms, and external regulation. It protects against overspend, fraud, legal exposure and reputational harm, and is enforced through controls, systems and audit.

Can you give an example of Procurement Compliance?

A compliance review checks that purchases used approved suppliers, valid POs and proper approvals.

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