Invoice matching software performs a comparison that is conceptually trivial and practically full of edge cases: does this invoice agree with what was ordered and what arrived. Real invoices differ from real orders in small ways constantly, and the entire usefulness of a matching product comes down to what it does with a difference of a few cents or a few units. That setting is called tolerance, and it is the thing to understand before anything else.
What the match compares
Three documents and, at minimum, four things: supplier identity, price per unit, quantity and the total. A two-way match compares invoice and order only, which is what you use for services and for anything with no physical delivery. A three-way match adds the goods receipt, which is what protects you from paying for something that never arrived. Which one applies is a property of the purchase, not a setting you pick once.
Tolerance: too tight and everything is an exception
Set tolerance at zero and rounding differences, freight added at invoicing and part deliveries all become exceptions requiring a human. Set it too wide and you are approving genuine price increases without noticing. Most teams end up with a percentage and an absolute cap together, so a small difference on a large invoice does not pass simply because it is proportionally tiny.
The exception queue is the real product
Everything that fails the match arrives somewhere, and how that queue behaves is what your team experiences daily. Does each item carry the reason it failed and the specific numbers that disagreed? Can it be routed to purchasing or the site without leaving the record? Is there an age on it? A product with a brilliant matching engine and a flat, reasonless exception list will still feel like work.
Questions people ask about invoice matching software
What tolerance should we set?
That is your policy decision and depends on your suppliers and your risk appetite. A percentage with an absolute cap is the common shape; whatever you choose, review the exception reasons after a month and adjust from evidence rather than from a default.
What about invoices with no purchase order?
They cannot be matched at all and must be approved by a person on their own merits. Software should route them differently rather than dropping them into the same exception queue as genuine mismatches.
Can it match part deliveries?
Good products match at line level and carry a running received quantity, so several invoices against one ordered line reconcile properly. This is worth testing specifically, because it is where weaker products fall back to whole-document matching.