That’s because purchase orders have to be matched to an invoice and/or a goods receipt, either at the header or line level. In most cases it’s a manual process performed by someone in accounts payable.
The downside of a manual process is that it is not only time-consuming (as the average matching session might take 15 minutes to an hour or more), but the back-and-forth communication with emails and spreadsheets leads to missed information and delayed payments.
Matching POs with hundreds of lines can be a tedious exercise at the best of times, and not the best use of the limited resources you have. As well, companies that rely on manual PO matching leave themselves open to manual errors and the risk of fraudulent activity.
Some accounts payable software solutions will have an option for PO matching, but often it’s a visual process of comparing an invoice on the screen to a PO on the screen – which makes it a manual process still.
Using an advanced automated purchase order management system, supplier invoices are automatically matched by the software against the corresponding internal or external PO at the header or line level. The matching process takes place according to predefined business rules and tolerances. Invoices matching within the approved tolerances are sent directly to the organization’s ERP for recording.