Understanding Two-Way Matching For Automation Of Accounts Payable
WHAT IS TWO WAY MATCHING
Navigating the software selection process for automation of accounts payable is an important task for finance executives charged with finding cost-efficient way to handle the process. Understanding two-way matching is an essential component of accounts payable automation.
Two-way matching streamlines the accounts payable process. The automation software compares the purchase order from the vendor (PO) to the actual received goods (GR) and invoice received from the vendor. This process may involve the use of bar-coding system for the GR against bill of lading, if needed. This check is made prior to payment and is an essential part of ensuring that the accurate goods have been received and the invoice is accurate, preventing any overpayment to the vendor.
To achieve two-way matching in accounts payable automation, financial executives should first evaluate the vendor?s invoicing system to ensure accuracy and ensure that the invoice matches the purchase order line-by-line. Pre-authorization workflows should also be put in place to ensure the purchase orders have cost associated, and any additional costs or deviations must be approved prior to payment.
Automation of accounts payable through two-way matching provides number of cost-saving and efficiency benefits. An excellent software solution should automate the matching, verification and payment process. Automating the PO-GR-IV process also allows finance executives to gain visibility into cash flow forecasting and analysis by leveraging full view of invoice and payment data.
Software for two-way matching should allow for full integration with existing ERP systems and support manual entry for cheaper and more flexible operations. Advanced features such as workflow automation and configurable data-validation rules are beneficial for financial oversight and stringent auditing requirements.
Considering these features, the modern finance executive should select comprehensive accounts payable automation software that ensures compliance, accuracy and efficiency. Through leveraging two-way matching and other best practices, finance executives can find practical and cost-effective solution for automating their accounts payable process.
