3-Way Match is an accounts payable control that compares three documents: the purchase order, the goods receipt note, and the supplier invoice. Payment is authorized only when item, quantity, and price agree across all three.
Why It Matters
Without 3-way match, suppliers can invoice for more than delivered, charge different prices, or bill twice. MSMEs lose 1 to 3 percent of purchase spend to these leaks. With 3-way match automated in an ERP, accounts pay only what was ordered, received, and billed, and any mismatch is flagged before cheque release.
Example with Indian Context
A pumps manufacturer issues PO for 1,000 bearings at INR 120 each. The GRN records 980 received (20 short). The supplier invoice arrives for 1,000 at INR 125. The 3-way match flags two problems: quantity mismatch (PO 1000, GRN 980) and price mismatch (PO 120, invoice 125). Accounts holds payment, purchase raises a debit note for the price difference, and the supplier issues a credit note for the 20 undelivered. Payment is released only for 980 at INR 120.
Related Terms
How ERPDrive Handles It
ERPDrive automatically matches supplier invoices against PO and GRN line by line. Tolerance rules can allow small price variances. Mismatches route to purchase for resolution, and only matched invoices flow into accounts payable for scheduled payment.
See It in Your Factory
ERPDrive handles 3-way match as a first-class workflow alongside BOM, MRP, quality, and GST. Book a 30-minute demo.
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