What is Three-Way Matching?
Three-Way Matching in Odoo is a process that ensures you only pay for what you receive by comparing three key documents before approving an invoice:
- Purchase Order (PO) – Specifies what was ordered.
- Receipt (GRN – Goods Receipt Note) – Confirms what was received.
- Vendor Bill (Invoice) – Details what is being charged.
How Odoo Handles Mismatches
If there is a discrepancy between these documents, Odoo flags the invoice under the **“Should Be Paid”** field in the Vendor Bill (under Other Info):
✔️ Yes – The invoice matches the PO and GRN; ready for payment.
❌ No – A mismatch is detected; payment should be reviewed.
⚠️ Exception – A minor issue that requires manual review.
Note: Odoo does not take automatic action on mismatches. Your team must review the flagged invoices and decide whether to proceed with payment.
Enabling Three-Way Matching in Odoo
To activate Three-Way Matching in Odoo, follow these steps:
- Navigate to Odoo > Purchase > Configuration > Settings.
- Locate the Purchase Order Matching (3-way matching) option.
- Enable this setting to allow Odoo to automatically check invoices against PO & GRN.
Once enabled, Odoo will compare the details from these documents and help in identifying discrepancies before processing payments.
How Three-Way Matching Works in Odoo
Here’s how the process flows within Odoo:
- Create a Purchase Order (PO): The procurement team raises a PO and confirms the order.
- Receive Goods (GRN): Upon receiving the items, the warehouse team validates the receipt.
- Vendor Invoice Processing: The supplier sends an invoice, and Odoo automatically matches it against the PO and GRN.
If everything aligns correctly, the invoice is marked as payable. If discrepancies are found, the invoice is flagged for manual review before payment.
Benefits of Three-Way Matching in Odoo
- Prevents Overpayments: Ensures invoices are paid only for received goods/services.
- Improves Financial Control: Reduces risks of fraud or errors in vendor payments.
- Streamlines Invoice Processing: Automates invoice verification, saving time and effort.
- Enhances Compliance: Ensures financial transactions are accurate and well-documented.
By implementing Three-Way Matching in Odoo, your organization can maintain better control over vendor payments and avoid discrepancies that could lead to financial losses.