What does two-way matching involve?

Two-way matching involves the process of comparing a purchase order to an invoice. This method is essential in the Procure to Pay (P2P) process as it ensures that the products or services billed by the supplier match what was originally ordered. This verification helps organizations maintain accurate financial records and control over their expenditures.

In this process, a company first generates a purchase order to specify what they wish to buy. When the supplier sends an invoice, the organization then verifies that the information—such as quantities and prices—on the invoice corresponds to what was specified in the purchase order. This alignment confirms that the company is only paying for what was actually ordered. This verification reduces the risk of errors and fraud, contributing to effective financial management.

The other answer choices involve different combinations of documents that are important in the procurement process but do not specifically define the two-way matching process as accurately as the purchase order and invoice documentation does. For instance, matching receipts with either purchase orders or invoices is a part of a three-way matching process, which includes a receipt in addition to both the purchase order and invoice for verification of actual delivery.