Three-way matching compares a purchase order, a goods receipt or service confirmation, and a supplier invoice before payment approval. The control checks whether the supplier billed for what the buyer ordered and actually received, within the organization's accepted tolerances.
How does Three-way matching work in practice?
The control compares the purchase order, goods receipt or service confirmation, and supplier invoice. Matching checks whether the supplier billed the approved item, quantity and price and whether the business recorded receipt. Tolerances determine which differences can pass automatically. Exceptions should be assigned and resolved before payment approval rather than hidden through manual overrides.
Quick reference for Three-way matching
| Check | What it means for the transaction |
|---|---|
| Category | Procurement and sourcing |
| Record to keep | Keep the requirement, requester, supplier response, evaluator and approval together when they apply. |
| Do not infer | Do not treat a sourcing record as a purchase order, invoice or proof of delivery unless that later document has actually been issued. |
