Scope of the Blog:
The purpose of the blog is to provide the overview of three way match Functionality & how SAP configuration can be utilized to achieve three way match functionality. SAP Three way match is one of the most common Purchase to Pay Business Process for Direct Materials (Stock Items) which exists across all industries.
SAP Three-way match overview:
- The Quantity & Price is matched between PO, GR & IR. (Three Levels)
- SAP Three way match is based on PO Line item (If a PO has multiple line items, Three way match is achieved in each line items)
- Buyer of the Purchase order ensures three way match in SAP & Buyer resolves the discrepancy by correcting PO,GR or IR.
- SAP Provides configuration & Reports (MRBR Report) to achieve three way match Functionality during Business transactions.
Configuration for Three-way Match
The Configuration for Three way match is done in the Following path is done in the following path.
SPRO-> Materials Management-> Logistics Invoice Verification-> Invoice Block-> Set Tolerance Limits
Configuration for Quantity Variance (Q):
Tolerance Key DW:
Tolerance Key DW blocks the Invoice when there is no corresponding GR for a line item of a PO.
It prevents the invoice to be paid immediately to vendor.
PO Qty -100
Vendor Provides Invoice first for 100 Qty .
GR is Posted after few days of invoice Posting
As soon as the invoice is posted in the system the invoice gets blocked due to DW tolerance key & doesn’t allow the system to pay the invoice immediately. The Blocked invoice appears in MRBR report & Buyer of the Purchase order takes the suitable Decision to ensure three way match.
Tolerance Key DQ :
Tolerance Key DQ Blocks invoice when there is Quantity discrepancy
DQ tolerance Config-5%
Since the invoice quantity is higher than the PO quantity the invoice gets blocked due to DQ tolerance Key. The Blocked invoice appears in MRBR report & Buyer corrects the discrepancy by taking suitable organisational decisions.
Configuration for Price Variance (P)
Tolerance Key PP:
Tolerance Key PP compares the price between purchase order & invoice with the Tolerance limit specified in the configuration.
PP tolerance in Config-200 $
PO Price -1000$ Qty-1
Invoice Price- 1400 $
Invoice is blocked since the Invoice price is higher than the PO price (More than Tolerance Specified.) The blocked invoice appears in MRBR report & Buyer corrects the discrepancy by taking suitable decisions.
Configuration for Order Price Quantity (OPQ)
SAP provides two Tolerance Keys Tolerance Key BR (IR before GR) & Tolerance Key BW (GR before IR) to address the order price quantity scenarios.
Tolerance Key BR (IR before GR) :
Invoice gets blocked if the Order Price Quantity variation is more than the value specified in configuration.
The system compares the ratio between quantities invoiced in order price quantity units: quantity invoiced in order units Vs quantity ordered in order price quantity units: quantity ordered in order units
MRBR (Program RM08RELEASE)Report
This report is run by Buyer of the Purchase order (Purchasing group wise) to verify the list of invoices blocked due to Quantity & Price variance for a given company code.
This program doesnot remove the block if the discrepancy is not resolved.The best practice is to run this report in background by company code so that the program removes the block automatically after the corrective action taken by Buyer.