You order 100 hinges at $25 each. The supplier’s invoice arrives for $2,500. The price matches. The order number matches. Everything looks ready for approval.
Down in the warehouse, someone has counted 80 hinges.
That is $500 of goods the business has been billed for but has not received. Comparing the invoice with the purchase order alone would miss it: both documents say 100.
Three-way matching brings the receiving record into the conversation. The purchase order says what you agreed to buy. The goods-received record says what actually arrived. The invoice says what the supplier is asking you to pay.
In this case, the warehouse manager checks the delivery note and calls the supplier. The remaining 20 hinges are on a second shipment due on Friday. Finance flags the bill for follow-up, with that explanation attached, rather than letting it disappear into the routine payment queue.
The important part was not a clever calculation. It was giving the person approving the bill a fact that lived somewhere else in the business.
Start with purchases that already have an order and a delivery record. Make it easy to find all three documents together, and decide who investigates a difference. For services, the receiving evidence might be an approved timesheet or a completed milestone instead of a delivery note.
A bill can match an order perfectly and still leave something missing. The receiving record is how you notice.
