Process family

Spend governance: seven approval and decision templates for committing money

Seven flowcharts for deciding whether money may be committed: the annual budget, budget approval, purchase approval by threshold, expense approval, conflict-of-interest review, fixed asset controls and the make-or-buy decision tree.

Spend governance is the set of gates a request passes before anyone is allowed to commit the company's money: is it in the plan, who holds the authority for this value and category, is the decision-maker conflicted, and should the thing be bought at all. This family groups the templates that make those decisions. It is a group rather than a sequence; a purchase, an expense claim and a capital project each pass through a different subset.

The plan comes first. The annual budget turns finance assumptions and department submissions into a challenged, approved plan; the budget approval workflow handles the costed requests that arrive in-year: funding check, forecast impact, delegated-authority routing, a published decision. When the request is a purchase, purchase approval classifies it as capex or opex, checks the budget, routes it by value and category through the delegation-of-authority matrix, applies the quote and preferred-supplier rules, and ends in a purchase order or a recorded decline. Employee spend takes the expense approval route instead.

The failures all pass on paper: a purchase signed by a manager whose limit it exceeds, a supplier approved by someone who part-owns it, an asset expensed to skip the capital appraisal, a budget line spent twice on a forecast nobody updated. Purchase approval's escalate branch and capex-or-opex test catch the first and third; the conflict of interest decision tree settles recusal, reassignment or escalation before approval; budget approval's forecast-impact check answers the fourth. Fixed asset management owns capitalization and disposal; make-or-buy tests core capability, capacity, fully loaded cost and IP risk before sourcing starts.

Once a purchase clears these gates it becomes a requisition and an order in procure-to-pay; once an expense claim clears its approval it is paid through payroll or in the same run as supplier invoices under accounts payable. The actual-versus-plan review that closes the budget loop is a step in the financial close, where fixed asset depreciation and impairment are also posted.