Variance Types Reference

Abstract

When a user saves a Vendor Bill or Item Receipt, Real-Time 3-Way Match compares the transaction against its related Purchase Order and/or Item Receipt and flags any discrepancies as variances. Some variances are always detected. Others only appear once you've defined the thresholds that trigger them.

This article describes every variance type the system can detect, which transactions each one compares, whether it can be customized through Override Settings, and what you need to configure to enable it.

How Variances Are Evaluated

Each variance type falls into one of two categories:

• Line-level variances compare individual lines, such as a single item's quantity, rate, or amount on a bill versus the matching PO line.
• Total variances compare the total billed or received amount across the entire transaction against a total threshold.

Each variance also applies to one or more comparisons:

• Bill vs PO: The vendor bill is compared against the purchase order.
• Bill vs Receipt: The vendor bill is compared against what was actually received.
• Receipt vs PO: The item receipt is compared against the purchase order.

Above and Below threshold variances work as a pair. By default, only variances that exceed a threshold are flagged. To also flag variances that fall below it, define your thresholds and enable positive and negative thresholds.

Variance Types

The table below lists all variance types. The Override columns show which criteria can be used to create an exception through Override Settings.

Variance Type	Line Level	Bill vs PO	Bill vs Receipt	Receipt vs PO	Override: Subsidiary	Override: Vendor	Override: Item	Override: Custom Criteria	Override: Threshold Type	How to Enable
Quantity Above PO Threshold	✅	✅		✅	✅	✅	✅	✅	✅	Define line-level quantity threshold(s)
Quantity Below PO Threshold	✅	✅		✅	✅	✅	✅	✅	✅	Define line-level quantity threshold(s) and enable positive and negative thresholds
Amount Above PO Threshold	✅	✅		✅	✅	✅	✅	✅	✅	Define line-level amount threshold(s)
Amount Below PO Threshold	✅	✅		✅	✅	✅	✅	✅	✅	Define line-level amount threshold(s) and enable positive and negative thresholds
Rate Above PO Threshold	✅	✅		✅	✅	✅	✅	✅	✅	Define line-level rate threshold(s)
Rate Below PO Threshold	✅	✅		✅	✅	✅	✅	✅	✅	Define line-level rate threshold(s)
Item Differs from PO Item does not match PO line's item	✅	✅		✅						Always enabled
Expense Differs from PO Account does not match PO line's account	✅	✅		✅						Always enabled
Item Not Associated to PO Item line does not exist on PO	✅	✅			✅	✅		✅		Always enabled (unless non-PO items are allowed)
Expense Not Associated to PO Expense line does not exist on PO	✅	✅			✅	✅		✅		Always enabled (unless non-PO expenses are allowed)
Quantity Above Receipt Threshold	✅		✅		✅	✅	✅	✅	✅	Define line-level quantity threshold(s)
Quantity Below Receipt Threshold	✅		✅		✅	✅	✅	✅	✅	Define line-level quantity threshold(s) and enable positive and negative thresholds
Amount Above Receipt Threshold	✅		✅		✅	✅	✅	✅	✅	Define line-level amount threshold(s)
Amount Below Receipt Threshold	✅		✅		✅	✅	✅	✅	✅	Define line-level amount threshold(s) and enable positive and negative thresholds
Rate Above Receipt Threshold	✅		✅		✅	✅	✅	✅	✅	Define line-level rate threshold(s)
Rate Below Receipt Threshold	✅		✅		✅	✅	✅	✅	✅	Define line-level rate threshold(s)
Not Received Item/expense line not received	✅		✅							Always enabled (when receiving is required)
Total Amount Billed Above PO Threshold		✅			✅	✅	✳️	✅		Define total threshold(s)
Total Amount Billed Below PO Threshold		✅			✅	✅	✳️	✅		Define total threshold(s) and enable positive and negative thresholds
Total Amount Billed Above Receipt Threshold			✅		✅	✅	✳️	✅		Define total threshold(s)
Total Amount Billed Below Receipt Threshold			✅		✅	✅	✳️	✅		Define total threshold(s) and enable positive and negative thresholds
Total Amount Received Above PO Threshold				✅	✅	✅	✳️	✅		Define total threshold(s)
Total Amount Received Below PO Threshold				✅	✅	✅	✳️	✅		Define total threshold(s) and enable positive and negative thresholds
PO Is Not Approved		✅	✅							Always enabled

✳️ Item override for total thresholds: Item variances can be excluded from impacting the total threshold.

Enabling Variance Types at a Glance

Variance types fall into four groups based on what's required to turn them on:

• Always enabled: Item Differs from PO, Expense Differs from PO, and PO Is Not Approved are detected automatically. Not Received is also always on whenever receiving is required.
• Enabled by default, with exceptions: Item Not Associated to PO and Expense Not Associated to PO are detected unless your configuration allows non-PO items or expenses.
• Requires line-level thresholds: Quantity, amount, and rate variances are only detected once the matching line-level threshold is defined.
• Requires total thresholds: Total Amount Billed and Total Amount Received variances are only detected once a total threshold is defined.

For steps to define thresholds, see:

Enabling 3-Way Match and Defining Thresholds

Next Steps

Once you know which variances your configuration will detect, decide how the system should respond to them, and create exceptions for vendors, subsidiaries, or items that need different rules:

Managing Variances, Payment Holds, and OverridesOverride Settings