All 24 Invoice Processing questions
More in Invoice Processing
What is invoice processing in accounts payable? What is the difference between a PO and a non-PO invoice? What key data fields must be captured from a supplier invoice? What is invoice coding? What is the difference between an invoice and a receipt? What is a self-billing invoice? Walk through the journal entry when a supplier invoice is recorded. What is a duplicate invoice and how do you prevent duplicate payments? How does electronic invoicing (e-invoicing) and OCR improve AP processing? What are invoice exceptions and how are they handled?
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What does 'three-way match' mean in one sentence, and why does invoice processing depend on it?

Beginner

Answer

A three-way match compares the purchase order, the goods receipt, and the supplier invoice to confirm you're paying for what was ordered and received at the agreed price; invoice processing relies on it to validate PO invoices automatically and block discrepancies before payment.
Real-world example A PO invoice only posts for payment once quantity and price agree across the PO, the receipt, and the invoice.

Common follow-ups: What is the third document in a three-way match? | What is two-way matching?

Purchase Orders & 3-Way Matching Invoice Processing Payment Runs
All 24 Invoice Processing questions