Three-way Match

What is a three-way match?

A three-way match is an accounts payable control that compares three documents before paying a vendor: the purchase order, the receiving report, and the invoice. The quantities and prices should match across all three. Discrepancies trigger an investigation before payment. This control prevents paying for goods not ordered, goods not received, or prices different from those agreed.

When three-way match matters

Three-way matching is most valuable for physical goods with clear delivery confirmation. Professional services are harder to match this way because there is no receiving report. For services, a two-way match between the statement of work and the invoice may be more practical. The principle remains: verify that what you agreed to matches what you received and what you are paying.

Automating the matching process

AP automation software can match documents automatically, flagging exceptions for human review. This speeds processing while maintaining control. Define tolerance thresholds for minor variances. A $2 difference on a $2,000 order probably does not warrant investigation. A $200 difference does. Automation handles the routine, so your team can focus on exceptions that matter.