How 3-way matching in NetSuite works: A quick guide

Ensuring accurate invoice payments is essential for any business using NetSuite, especially when managing purchase orders (POs) and goods receipts (GRs). While NetSuite provides the tools to implement 3-way matching, understanding how to configure and optimize the process is just as important.

This guide covers how 3-way matching works in NetSuite and how businesses can further enhance their accounts payable efficiency.

What is 3-way matching in NetSuite?

3-way matching is an accounts payable process that verifies an invoice against its corresponding purchase order (PO) and goods receipt before approving payment. This ensures that businesses only pay for goods or services that were ordered, received, and billed correctly, preventing overpayments, fraud, and accounting errors.

3-way matching in NetSuite follows the standard AP process used in most ERP systems:

1. Compare the purchase order: This ensures the order details (items, quantity, and price) are correct before processing
2. Match the invoice to the PO: This confirms the vendor’s invoice aligns with what was originally ordered
3. Validate against the goods receipt (GR): This ensures the business has actually received the items before approving payment

If all three documents match within predefined tolerances, NetSuite processes the payment automatically. If discrepancies arise, the system flags the invoice for review, preventing overpayments or fraud.

When should businesses enable 3-way matching in NetSuite?

3-way matching is most useful when tracking physical goods, where verifying delivery before payment is essential. It also plays a key role in tightening financial controls, helping businesses catch duplicate payments and stay audit-ready.

With NetSuite’s built-in AP automation and customizable matching rules, AP teams can enforce compliance without slowing down operations.

How to set up 3-way matching in NetSuite

While naming conventions may vary across NetSuite modules, the general setup follows a structured process. Businesses can refer to NetSuite’s support documentation for module-specific guidance, but the core steps include:

1. Enable 3-way matching features: Go to Setup > Company > Enable Features and turn on Accounts Payable, Purchase Orders, Advanced Receiving, and SuiteFlow for workflow automation.
2. Set up matching preferences: Navigate to Setup > Accounting > Accounting Preferences, enable vendor bill approval routing, and configure tolerance levels for invoice mismatches.
3. Install the 3-way match workflow: Go to Customization > SuiteBundler > Search & Install Bundles, search for NetSuite Approvals Workflow, and install it.
4. Activate the approval workflow: Go to Customization > Scripting > Workflows, select 3 Way Match Vendor Bill Approval, and set the status to Released to automate invoice validation.
5. Assign approval roles and permissions: Define who approves invoices when discrepancies arise, ensuring AP teams, finance managers, and other relevant roles have the correct permissions.

Once configured, NetSuite automates invoice validation based on these rules, helping businesses to improve AP efficiency and establish financial controls.

How NetSuite handles 3-way matching—and when to consider extending it

Once 3-way matching is set up, NetSuite automates most of the verification process, reducing manual workload for accounts payable teams. As always with most automation sequences, some steps may require human oversight—especially when discrepancies arise.

Here’s what NetSuite handles automatically:

NetSuite includes robust support for 3-way matching out of the box, allowing businesses to match invoices with purchase orders and goods receipts to ensure accurate payments. For many teams, this functionality works well as part of their broader ERP workflows—especially when they’ve already invested in NetSuite as a central source of financial truth.

In other cases, layering on an AP automation solution that integrates with NetSuite can provide even more control and speed—while still keeping NetSuite as the system of record. This is where dedicated AP tools with advanced 3-way matching functionality come into play.

How Ramp provides additional invoicing and AP Automation features

Ramp offers an automated AP solution that can integrate with NetSuite, streamlining invoice matching while reducing manual intervention even further.

Here’s how Ramp aligns with key AP automation and 3-way matching needs:

How 2-way and 3-way matching works in Ramp

Ramp’s matching process is integrated with NetSuite, reducing the need for manual reconciliation. Here’s how it works:

1. Ramp syncs purchase orders and goods receipts from NetSuite: POs and GRs are automatically pulled into Ramp, ensuring up-to-date records for invoice validation.
2. Invoices are matched against existing NetSuite records: When a new invoice is processed in Ramp, it’s automatically matched to a PO (2-way match) or both a PO and goods receipt (3-way match). If everything aligns within predefined tolerance levels, Ramp marks the invoice as approved.
3. Discrepancies are flagged and routed for review: If an invoice doesn’t match the expected PO or GR details, Ramp triggers an exception approval workflow.
4. Final approval and NetSuite reconciliation: Once the invoice passes the verification process, it’s automatically recorded in NetSuite with the correct GL coding, vendor details, and payment status.

For a deeper look at how Ramp integrates with NetSuite for 3-way matching, explore our detailed breakdown. By automating these steps, Ramp reduces the manual effort required for invoice matching in NetSuite even further, allowing businesses to better streamline their AP operations.

Automate 3-way matching with Ramp's NetSuite integration

The right invoice matching solution should integrate smoothly with your AP workflows, eliminate inefficiencies, and scale with your business. With NetSuite’s strong, built-in invoice matching tools, businesses can also layer on additional automation with Ramp.

Ramp’s integration with NetSuite helps to further automate invoice validation, reducing approval times and catching discrepancies before they become payment issues.

Faster approvals, fewer mismatches, and a strong ERP integration—without the complexity of manual reconciliation. Get started with Ramp.