Sachin Sharma explains why QuickBooks can't handle three-way matching of purchase orders, receipts, and invoices. He shows how this gap creates operational headaches and control problems for finance teams, then walks through using a system like Precare Desk on top of QuickBooks to automate the process.
Using QuickBooks and struggling with a three pay match process, then this video is for you. Most companies spend a lot of time, in excess of 10 hours a week to match the invoices with purchase orders and receipts. And the reason for that is they don't have a single place to manage all that. So in this video I'm going to walk you through steps you can take to automate the three way match process and then how to solve it for good. If you're joining me for the first time, welcome. My name is Sachin Sharma. I am the founder of Precare Desk where we help growing companies automate their procurement and AP processes. So let's talk about why three way match and why it matters. If you are not doing a three way match today, you are doing one of two things. Either A, you are paying the invoices without matching it with the receipt and purchase order, which means you're relying on the vendor's capability to deliver it on time. Right. Or they delivered what they actually agreed to deliver or you have a process which is very heavy. What I mean by that, every invoice needs to be approved. Sounds familiar. That is what most companies are doing today if they do not have a three way match process. So in theory, three way match is you look at what you ordered, you look at what was actually delivered and you look at what was invoiced. If all of them three matches, then you can pay the vendor. It's as simple as that. But if they don't, then you need to investigate further. Right? So conceptually that's why it matters, to make sure that you're not overpaying vendors or you're not paying for invoices or the material that was never ever delivered. Why? Then it becomes a problem even if you do it. Most companies that are using QuickBooks are dealing with this problem because QuickBooks is not designed for three way match. Right? So if using QuickBooks online, there's no place to create a receipt. There is the invoice and there's the purchase order and the purchase order is marked as receipt when you invoice it. QuickBooks Desktop does it a little bit better, but then again you have to convert the receipt into a bill, which is very cumbersome process and you can't keep on attaching the actual documents. So it's just not designed for that. So what is the impact on finance teams? The impact is you are running blind. Right? So you don't have a three way match process or even if you have it, then they have to do it manually. So they are putting the invoice in QuickBooks, but before they do that, they have a separate folder somewhere on a shared drive where they have a purchase order, they have a receipt and invoice and the team has to do manually like kind of match that. The problem is it doesn't scale. Tomorrow you're processing 100 invoices and you know it scales go to 500,000. You have to keep on hiring people and even if you're, you know, you have the unlimited headcount, it's very hard to scale people without having a centralized process. So then that means you're paying your vendors late or you're overpaying your vendors or you're paying duplicate invoices. Very common problems when you don't have a three way match. So how do you deal with it? The simple solution is to have a system that sits on top of QuickBooks that captures your purchase order, that captures your receipt, that captures your invoice and run a three way match process or a two way match process if you're buying services. And then only once the in match is done, invoice is approved for payment only then the Invoice goes to QuickBooks. So you're not, first of all, you're not having people in QuickBooks all the time. That's number one, right? That's not good for controls or for your books. But second thing is you now have a complete process outside. You can use tools like ProcureTest or any other tool that supports that three document. But it's important to have purchase order receipts and invoice in the single place or single system to run the match effectively. So hope you enjoyed this video. If you're struggling with 3 way match in QuickBooks, click the link below to schedule a time with one of our product specialists. I'll be happy to walk you through how we can solve that problem for you. Thanks for joining me today and I'll see you in the next video.
