![]() ![]() No matter the amount of documents required, all invoices must meet matching tolerances. Some approval processes are more lenient. It all depends upon the software you choose and company regulations in place. When the price on the invoice does not match what is on the purchase order, this is considered a price deviation. When details on the invoice do not match the supporting document (purchase order, receipt of goods, supplier invoice) in terms of amount, this is considered a quantity deviation. A tolerance typically involves confirming the invoice amount matches the purchase order details.Īn invoice hold occurs if an invoice and its corresponding PO don’t match and/or items cannot be confirmed as received. ![]() These processes rely on certain tolerances that must be met and invoice holds when they aren’t. Once all 4 components match, the invoice is entered into the AP database. This typically has to do with quantity tolerance. To make it a four-way, it also requires inspection information. Much like three-way matching, this process needs a purchase order, receipt of goods, and supplier invoice. All three components must match within agreed-upon tolerance levels. This happens when an invoice is matched with a purchase order, the receipt of goods, and a supplier invoice. This occurs when an invoice from a third-party is matched with a purchase order, tolerances are met, and the invoice is entered into a database. There are three common types of matching in accounts payable automation, creating a two-way, three-way, or four-way match. Beyond the purchase order, other supporting documents can be used during this process such as a supplier contract, goods receipt, and delivery confirmation. There are three tiers of invoice matching: 2-way matching, 3-way matching, and 4-way matching. The automated invoice process includes matching information like: Invoice matching is an automated process used by AP professionals to ensure that there are no discrepancies between a purchase order (PO) and an invoice. So what exactly is invoice matching, and why is it so critical to running a successful business? What is Invoice Matching? Without it, the IRS will consider your papertrail inefficient and may levy fines. Matching (also known as PO matching) is used by finance departments to ensure proper oversight of a company’s transactions. Especially if your process involves a lot of extra paperwork, like shipping receipts and inspection reports.įear not! Touchless invoice processing is here to save the day. After an invoice is settled, it must be matched with your accounting record.
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