Oracle Purchasing – Invoice Matching Methods - Two, Three, and Four Way
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Oracle Purchasing offers 2, 3, and 4 way invoice matching methods. 2 way matching matches invoices to purchase orders, 3 way adds receiving information, and 4 way adds inspection information. The level of matching can be set at different levels to override defaults. 2 way matching simply checks invoice quantities and amounts against the purchase order, while 3 and 4 way matching add additional validation of receiving and inspection records. If tolerances are not met, an invoice hold is placed until resolved.
Oracle Purchasing – Invoice Matching Methods - Two, Three, and Four Way
- 1. Oracle Purchasing – Invoice Matching Methods - Two, Three, and Four Way What is Matching? Matching is a process performed for goods and services ordered through a purchase order that takes place during the online invoice approval process. Invoices are matched to purchase orders (2 way matching), receiving information (3 way matching), and inspection information (4 way matching) as applicable. The invoices must meet matching tolerances or a hold is placed on the invoice and payment cannot be made until the hold is resolved or manually released. Refer to "Tolerances" and "Invoice Holds" for more information. The default setting for all invoices is 2 way matching, if 3 or 4 way matching is required it must be set on each purchase order when it is created. PO Matching Setting in Purchase Order Shipment Line We can Set Invoice matching in five different areas of Oracle Purchasing: In the list below, a setting at any level will override the settings above it. 1. Oracle Purchasing Options a. Navigate to: Setup > Organizations > Purchasing Options b. Select Default Alternative Region 2. Supplier Information a. Navigate to: Supply Base > Suppliers b. Query on specific supplier c. Click on Open d. Select Receiving Alternative Region 3. Line Types a. Navigate to: Setup > Purchasing > Line Types b. In the Receipt Required field: Yes = 3-way, No = 2-way 4. Items a. Navigate to: Items > Master Items b. Query on specific item c. Select Purchasing Alternative Region d. In the Invoice Matching section: Yes = 3-way, No = 2-way 5. Purchase Order Shipments a. Navigate to: Purchase Orders > Purchase Orders b. Enter (header and) line information c. Click on Shipments button d. Select More Alternative Region 2 Way Matching Process In the 2 way matching process quantity and amount on the invoice are matched to the quantity and amount on the corresponding purchase order. The following table outlines the 2 way matching process:
- 2. Step Action 1 An invoice is received from a supplier (vendor) for payment of goods or services ordered through a purchase order. 2 An invoice is created in the accounts payable module and matched to a purchase order. 3 During the online invoice approval process, the invoice quantity and amount is matched to the purchase order to ensure that tolerances are met. 4 If tolerances are . . . Then met and no holds are placed on the invoice and the invoice is approved for payment. not met a hold is placed on the invoice. See step 5. 5 The reason for hold must be resolved or a manual release of the hold must be processed. 6 Once the hold is resolved or released, the invoice approval process must be repeated and if all tolerances are met, the invoice is approved for payment. 3 Way Matching Process In the 3 way matching process is used when an operating location is using online receiving. In 3 way matching an invoice is matched to the corresponding purchase order for quantity and amount and to receiving information. The following table outlines the 3 way matching process: Step Action 1 Goods or services ordered through a purchase order are received by central receiving or the appropriate operating location department. 2 A query is performed in the purchasing module, receiving form (transaction screen) to find the appropriate purchase order. 3 Data is entered and saved into the Oracle receiving form (transaction screen) including quantity received. 4 Delivery of goods is recorded in Oracle and then manually performed for receipt by end user (this would be done if using central receiving). 5 An invoice is created in the accounts payable module and matched to the purchase order created in the purchasing module. 6 During the online invoice approval process, the invoice quantity and amount is matched to the purchase order and receiving information to ensure that tolerances are met. 7 If tolerances are . . . Then
- 3. met and no holds are placed on the invoice and the invoice is approved for payment. not met a hold is placed on the invoice. See step 8. 8 The reason for hold must be resolved or a manual release of the hold must be processed. 9 Once the hold is resolved or released, the invoice approval process must be repeated and if all tolerances are met, the invoice is approved for payment. 4 Way Matching Process The 4 way matching process is used when an operating location is using online receiving and inspection. In 4 way matching an invoice is matched to the corresponding purchase order for quantity and amount, receiving, and inspection information. The following table outlines the 4 way matching process: Step Action 1 Goods or services ordered through a purchase order are received by central receiving or the appropriate operating location department. 2 A query is performed in the purchasing module, receiving form (transaction screen) to find the appropriate purchase order. 3 Data is entered and saved into the Oracle receiving form (transaction screen) including quantity received. 4 Inspection information such as quantity accepted or rejected is recorded into the Oracle inspection form. 5 Delivery of goods is recorded in Oracle and then manually performed for receipt by end user (this would be done if using central receiving). 6 An invoice is created in the accounts payable module and matched to the purchase order created in the purchasing module. 7 During the online approval invoice process, the invoice quantity and amount is matched to the purchase order and receiving and inspection information to ensure that tolerances are met. 8 If tolerances are . . . Then met and no holds are placed on the invoice and the invoice is approved for payment. not met a hold is placed on the invoice. See step 9. 9 The reason for hold must be resolved or a manual release of the hold must be processed. 10 Once the hold is resolved or released, the invoice approval process must be repeated and if all tolerances are met, the invoice is approved for payment.