3-Way Match Explained

Three-way matching checks that the purchase order, the goods receipt and the supplier invoice agree on quantity and price before payment is approved.

The three documents

• Purchase order: What you ordered and at what price.
• Goods receipt: What actually arrived.
• Supplier invoice: What the supplier bills.

How the match works

Price on the invoice must be within tolerance of the PO price, and invoiced quantity must not exceed received quantity. Small differences can be allowed through tolerances such as 2% on price.

Example

PO: 100 units at 250. Received: 95. Invoiced: 100 at 255. Price is 2% over (within tolerance) but 5 units were not received, so the invoice is held and only 95 are payable.

Benefits

Prevents overpayment, duplicates and fraud, and creates a clear audit trail.

Frequently asked questions

General information, not tax, legal or accounting advice. Rules and rates change; confirm with a qualified professional. Only document real transactions.