An invoice discrepancy is any difference between what a vendor bills and what your records say you owe. The mismatch might be in quantity, unit price, tax, payment terms or vendor details, or the invoice might repeat one you already processed. Accounts payable holds the invoice, documents the difference, and asks the vendor for a corrected invoice or credit memo.
Most discrepancies are honest mistakes: a price list that was never updated, a partial shipment billed in full, a typo in a tax line. They still cost money if nobody notices, and they cost time when someone notices after payment and has to chase a refund.
What are the common types of invoice discrepancy?
The table below covers the discrepancies AP teams at small and mid-sized companies run into most often, what each looks like, and what to compare it against.
| Type | What it looks like | Check it against |
|---|---|---|
| Quantity | Billed for 100 units, 80 arrived; or billed for a full shipment that came in two parts | Purchase order and receiving record |
| Price | Unit price higher than the PO, the contract or the vendor’s recent invoices | PO, contract, price history for that vendor |
| Duplicate | The same charge billed twice, sometimes under a new invoice number | Invoices already entered or paid for that vendor |
| Tax or math error | Line totals that do not add up, tax on exempt items, wrong tax rate | Your own recalculation and exemption records |
| Vendor details | A new remit-to address, a different bank account, a name that does not match the vendor file | Your vendor master file, confirmed by phone |
| Missing PO or receipt | No PO number, or goods and services with no record of delivery | Purchasing and receiving |
| Terms or discount | Net 30 billed as Net 15, an agreed early-payment discount left off | Contract or PO terms |
Price differences get their own analysis, including how to calculate the variance, in our guide to invoice price variance. Duplicate charges have several distinct causes, covered in double billing and duplicate payments.
A change in bank details deserves a separate word of caution. It is the one discrepancy on this list that is more often a fraud attempt than a clerical error. The FBI’s Internet Crime Complaint Center advises businesses to verify requests for changes in account information through a secondary channel. Call the vendor on a number you already have on file, never one printed on the invoice or in the email. For the other patterns to watch for, see invoice fraud warning signs.
How can I verify an invoice before approval?
Invoice verification (some teams call it invoice validation) is the set of checks an invoice passes before anyone approves it for payment. A short, consistent checklist does more than a long one that people skip under deadline.
- Confirm the vendor is in your vendor file and the name, address and remit-to details match what you have on record.
- Match the invoice to a purchase order, if your process uses them, and confirm the PO number is valid and still open.
- Compare billed quantities with the receiving record or with confirmation from the person who ordered the service.
- Compare unit prices with the PO or contract, and with what this vendor charged on recent invoices.
- Recalculate line totals, subtotal, tax and the invoice total.
- Check payment terms and any discount against the contract.
- Search for the invoice number, and for the same vendor and amount, among invoices already entered or paid.
- Confirm the invoice is addressed to the right entity and coded to the right account and cost center.
Steps 3 and 4 are where most of the real money sits, and they are also the steps most often done by eye. Step 7 is easy to skip because it feels redundant, yet a resent invoice with a new number will pass every other check on this list.
How do you resolve an invoice discrepancy?
Once a check fails, the goal is a paper trail that ends with a correct document from the vendor. Here is a sequence that works for most teams.
- Put the invoice on hold. Mark it as disputed in your AP system or tracker so it is not approved or paid by someone who did not see the problem.
- Document the difference. Record the invoice number, the line affected, what was billed, what you expected, and the source you compared it with (PO, receiving record, contract, earlier invoice). Attach copies.
- Contact the vendor in writing. Email your usual contact or their billing team with the specifics. If the issue is a change in bank details, phone a known contact as well.
- Ask for a corrected invoice or a credit memo. Do not edit the vendor’s invoice yourself. Texas State University’s accounts payable procedure puts it plainly: a revised vendor invoice or credit memo is required for billing corrections. The same page sets a deadline of 21 calendar days to notify the vendor in writing, which is a useful internal target even where no law requires one.
- Approve and pay the corrected amount. Link the credit memo or revised invoice to the original so the history is in one place.
- Record the outcome. Note the cause, the amount, how long it took, and whether the vendor or your own team made the error.
If the vendor issues a credit memo and you keep buying from them, the credit usually offsets a future invoice. Miami University’s AP policy describes this and also has staff prepare a weekly report of outstanding credit memos, which stops credits from sitting unused. If the relationship has ended, request a refund in writing.
Sometimes the discrepancy turns out to be on your side: goods were received but never logged, or a price increase was approved and nobody updated the PO. Fix the internal record, release the hold, and note that too. Those cases matter when you look at patterns later.
How do you write an invoice discrepancy email to a vendor?
Keep it short and specific. The vendor’s billing team needs the invoice number, the exact line, the amount you expected, and what you want them to send back. Tone matters less than precision.
Here is a plain template you can adapt:
Subject: Invoice [number] on hold: [quantity / price / tax] difference
Hello [name],
We have placed invoice [number], dated [date], for [amount] on hold because it does not match our records.
Line [x], [item]: billed [quantity] at [unit price]. Our [PO number / receiving record / contract] shows [quantity] at [unit price]. The difference is [amount].
Please send a corrected invoice or a credit memo for [amount], referencing invoice [number]. We will process payment for the corrected amount once we receive it.
Thank you, [Name], Accounts Payable, [Company], [phone]
Attach the PO or receiving record if the vendor is likely to ask for it. For a duplicate, name both invoice numbers and dates. For a change in bank details, do not reply to the email that requested it. Start a new message to your known contact, or call.
How do you track recurring discrepancies by vendor?
A single discrepancy is a task. The same discrepancy from the same vendor every quarter is a process problem, and you only see it if you log each case in a consistent format.
A spreadsheet is enough for most teams. Give each discrepancy one row with these columns:
- Date found and date resolved
- Vendor
- Invoice number
- Discrepancy type (use the categories from the table above)
- Amount in dispute
- Cause, and whether it was a vendor or internal error
- Resolution (credit memo, corrected invoice, internal fix, written off)
Review it monthly or at quarter end. Sort by vendor and type. A vendor that keeps billing an old contract price needs a conversation with whoever owns that contract. Repeated quantity differences on one delivery route may point to a receiving problem on your side. If duplicates keep coming from one vendor, find out whether their system resends invoices on a timer.
The same log is useful evidence when you run a periodic accounts payable audit, because it shows where the controls are already catching problems and where they are not. If you are working from an exported invoice list, our guide to finding duplicate invoices in Excel covers the formulas.
Where does OverpayAlert fit?
OverpayAlert covers two of the checks on the list above: step 4, comparing prices with what the vendor charged before, and step 7, looking for invoices you have already seen. You forward invoices by email or upload them, and it flags potential duplicate invoices, including ones with a changed invoice number or a vendor name written two ways, and unusual price increases compared with that vendor’s own history. A person on your team reviews each flag and decides what to do. On the Growth and Scale plans, reviewed invoices export as a CSV for QuickBooks Online or Xero that you import yourself (there is no live sync), and on the Scale plan your own systems can use the REST API.
It does not match invoices to purchase orders or receiving records, so quantity checks, tax recalculation and vendor-detail verification stay with your team. If price and duplicate checks are the ones your team does by eye today, start a 7-day free trial and run your recent invoices through it.