If you register a quantity of items delivered on your PO, that is smaller than the ordered quantity:

... when you click on Mark as Delivered, and create an invoice from this order you will be asked if you want to create a back order.

Click on OK to automatically:

1. Create a back order for the remaining quantity not delivered.   
2. Create a supplier invoice from the quantity delivered.
3. Updated stock with only the amount delivered, while the rest of the items are sent to the back order.
4. The back order gets a new PO number and you can use the tracking function to trace back to the original PO.
5. A text also appears in the new purchase order, under the item rows indicating it is a back order created from purchase order no XX.
   
   
6. In the Purchase order list, the back order is marked with BAO.