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CASH MANAGEMENT POLICIES AND PROCEDURES HANDBOOK
APPENDIX F. PROMPT PAYMENT REQUIREMENTS
Section 1.0 General
This appendix to the Handbook establishes Department of Commerce policies and
procedures for timely payment of bills, as well as for the payment of interest and
penalties (if any) when payments are made late. Such late payment penalties apply only
to those contracts covered by the Prompt Payment Act (P. L. 97-177, as amended by P. L.
100-496), as set forth in 31 USC Chapter 39, Prompt Payment.
Section 2.0 Policy Intent and Authority
.01 Intent
Purchase activities should be conducted in a manner that will achieve the lowest
possible cost while maintaining good business relationships with suppliers. To
achieve this objective, organization unit finance offices shall observe the following
principles. Pay bills by the established due date, but not earlier than seven days
prior to the payment due date -- unless earlier payment will result in a discount or
rebate.
Base payment on receipt of proper Invoices and satisfactory performance of
contract terms. Exception: accelerated payment to a vendor is permitted prior to
verification that merchandise has been received, under certain circumstances, such
as the maximization of rebates. Automatically pay interest and late penalties (if
any) on bills that are paid late and that are subject to the Prompt Payment Act,
without payees requesting these payments.
Take advantage of cash discounts, consistent with applicable Treasury guidelines,
and in compliance with the Prompt Payment Act.
However, the Department of Commerce is still tracking Prompt Pay interest and
penalty payments as well as other related information for internal use and for use in
any other consolidated reports that may be required by law. Bureaus are therefore
asked to continue to maintain Prompt Pay information and a system to assemble and
transmit such information.
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.02 Authority
Department policies and procedures comply with the requirements of:
1. Prompt Payment Act (P. L. 97-177), as amended by P.L. 100-496, as set
forth in 31 USC Chapter 39, Prompt Payment
2. Government - Prompt Payment Act Interest Rate
3. 5 CFR 1315, Prompt Payment
4. Disbursement requirements contained in Treasury Financial Manual
(TFM), TFM Volume I
5. Cash discount requirements contained in Treasury Financial Manual
(TFM), TFM Volume I
6. Cost effective cash discounts information on Treasury Current Value of
Funds Rate Website, Cash Discounts. (The Current Value of Funds Rate
(CVFR) is used to calculate interest on overdue federal government
receivables and to determine the effectiveness of taking cash discounts.)
The Director for Financial Management (OFM) is responsible for ensuring that:
These policies and procedures are effectively implemented Department wide; and
that Individual finance offices develop and maintain internal operating procedures
to ensure timely payment of bills.
Each organization unit Finance Officer is specifically responsible for: Ensuring
timely payment of bills and the payment of interest and penalties when required; as
well as determining the causes of any unacceptable level of interest penalties
incurred, and taking necessary corrective or disciplinary action(s).
To ensure compliance with the Prompt Payment Act, each Finance Officer (or
designee) will:
1. Designate an individual(s) who will be responsible for developing,
implementing, and maintaining Prompt Payment procedures;
2. Establish timely bill payment as a criterion in the performance appraisals
of each designated employee responsible for overseeing prompt payment
of bills;
3. Make certain that internal operating procedures are developed and
effectively maintained and that particular emphasis is placed on ensuring
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that individual large dollar payments are made on time and that
appropriate cash discounts are taken;
4. Work closely with appropriate organization unit offices to ensure that
Receiving Reports are promptly forwarded to payment office(s); and
5. Implement (an) effective Quality Control Program(s) within each payment
office as described in 5 CFR Section 1315, Prompt Payment
Section 3.0 Standards for Prompt Payment
.01 Determining the Payment Due Date
The period available to make a timely payment without incurring an interest penalty
begins on the date of receipt of a Proper Invoice.
An Invoice is deemed to be received on the later of:
• The date a Proper Invoice is received by an agency if the agency annotates
the invoice with the date of receipt; or
• The seventh day after the date in which goods are delivered or services
completed, unless acceptance occurs earlier or if a longer acceptance period
is specified in the contract.
• If the agency fails to annotate an Invoice with the date of its receipt, the date
placed on the Invoice by the contractor is used to determine the start date for
the payment period.
Unless otherwise specified, payment is due:
• In accordance with the date specified in the contract;
• In accordance with discount terms when discounts are offered and taken;
• In accordance with Accelerated Payment Methods; or
• 30 days after the start of a payment period, when a Proper Invoice is
received.
.02 Misdirection of the Invoice by the Vendor to an Office Other Than the
Designated Agency Office
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The payment period does not begin until the date the invoice is received by the
designated agency office. “Agency Office” is defined as the office designated by
the Purchase Order, Agreement, or Contract to first receive and review Invoices.
The Agency Office may be different from the office issuing the payment.
.03 The Treatment of Holidays and Weekends in Determining the Payment Due
Date
When calculating the Payment Due Date, "day" means a calendar day including
weekends and holidays. However, when the Payment Due Date itself (including
discount due dates, falls on a weekend or Federal Holiday) payment may be made
on the following business day.
.04 Accelerated Payment Methods
The Prompt Payment rule expands the options for making early payments in certain
circumstances if doing so is in the best interest of the government. Agencies may
accelerate payments for:
• Single invoices under $2,500;
• Payments to small businesses; or
• Payments related to emergencies, disasters, and military deployments.
.05 Interagency Payments
Prompt Payment late interest penalties do not apply to interagency payments.
However, agencies are required to use electronic payment methods for interagency
payments and to include advance billing and other payment terms in Interagency
Agreements to ensure timely payments.
.06 Late Interest Penalties Regulated by State, Local, or Foreign Governments vs,
Prompt Payment Late Interest Penalties
Late payment rates for utility services issued by state, local, or foreign governments
take precedence over the Prompt Payment late interest penalties for determining the
amount of interest due for late payments.
.07 Federal Government Vendors Failing to Make Prompt Payment to their
Subcontractors
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The Prompt Payment rule does not generally provide for late interest penalties for
payments made to subcontractors. Under construction contracts, however, an
agency may withhold payment from a prime vendor if they learn that the prime
vendor has failed to pay their subcontractor in accordance to the terms of their
contract.
.08 Travel Reimbursements to Federal Employees
Although the Prompt Payment rule does not cover travel reimbursements to Federal
employees, 41 CFR, Subtitle F, Federal Travel Regulation System, Chapter 300,
General, Parts 301-51, Paying travel expenses; 301-52, Claiming reimbursement;
301-54, Collection of undisputed delinquent amounts owed to the contractor issuing
the individually billed travel charge card; 301-70, Internal policy and procedure
requirements; and 301-76, Collection of undisputed delinquent amounts owed to the
contractor issuing the individually billed travel charge card, requires agencies to
reimburse an employee within 30 days after the employee submits a proper travel
voucher to the approving official.
Late payments are subject to an interest penalty based on the Prompt Payment
interest rate in effect. When the payee is an employee entitled to reimbursement for
travel expenses:
• The Agency must reimburse the employee within 30 calendar days of
submission of a Proper Travel Voucher to the Approving Official;
• The Agency must notify the employee within seven days of receipt of a
Travel Voucher of any error therein that would prevent payment within 30
calendar days of submission; and
• The Agency should not hold payments due on Travel Vouchers (to utilize
the 30-day period allowed). Payments should be made as-soon-as-possible
to the employees. In the event of late payment, the Agency will pay the
employee a Late Payment Fee in addition to the amount due.
Notes:
Late Payment Fees are calculated using the prevailing “Prompt Payment Act
Interest Rate beginning upon the 31st day after the required Payment Date and
ending upon the day the payment is made.
In addition to the Late Payment Fee, the Agency must also pay the employee the
equivalent of any Late Payment Charge that the Card Contractor would have been
able to levy upon the employee.
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.09 Late Payment Interest Penalties B Determining the Amount of the Penalty
Interest is calculated from the day after payment was due until the day payment is
made. The interest rate in effect on the day after the payment due date is used to
calculate the interest penalty. (See Section 10 for additional guidance.)
• The following formula can be used to determine simple daily interest:
P(r/360*d)
Key:
• P is the amount of principal; r equals the Prompt Payment interest rate;
and equals the number of days for which interest is being
calculated.
• The following formula can be used to determine monthly compounding
interest: P(1+r/12)n * (1+(r/360*d)) -P
Additional information on the calculation of late interest penalties including
examples can be accessed on Treasury’s Prompt Payment website at:
http://www.fms.treas.gov/prompt/index.html
.10 Payment Due in One Fiscal Year, but Paid After the Payment Due Date in a
New Fiscal Year
An agency must pay an interest penalty out of amounts made available to carry out
the program for which the penalty is incurred. The interest payment is charged to
the fiscal year of the day after the invoice payment due date (which is the day the
agency incurred the obligation to pay interest). Therefore, if the product or service
in support of this program was purchased in FY 1999, it should be paid from FY
1999 funds.
Section 4.0 Purchase Orders and Contracts
A copy of each Purchase Order or Contract along with a “Notice”, or cover sheet (that
clearly states whether or not the agreement is covered by the Prompt Payment Act) will
be furnished promptly after issuance to the Finance Office responsible for making
payment. Upon receipt of each Purchase Order or Contract, the Finance Office will
review its provisions to determine whether the document contains all of the information
needed to make a timely and accurate payment(s). If the provisions are found to be
deficient, the Finance Office will notify the Contracting or Procurement Office
immediately and request that the necessary modification(s) be made to the document.
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Section 5.0 Invoices
.01 Proper Invoice
The following correct information constitutes a Proper Invoice and is required as
payment documentation:
1. Name of payee and Invoice date (vendors/contractors are encouraged to
date
2. Invoices as close as possible to the date of mailing or transmission);
3. Taxpayer Identification Number (TIN), if not previously provided;
4. Contract number, Purchase Order Number, or other authorization for
delivery of property or services;
5. Description, price, and quantity of property and services actually delivered
or rendered;
6. Shipping and payment terms;
7. Name (where practicable), title, telephone number along with complete
mailing address of responsible official to whom payment is to be sent; and
8. Other substantiating documentation or information as required by the
contract.
9. EFT information, if not previously provided.
Note: The Invoice should be date-stamped by the Payment Office with the date of
receipt. Otherwise, the date placed on the Invoice by the contractor/vendor will be
used to calculate the payment due date. Invoices for JPMorgan Chase Purchase
Card services are considered “received” on the date that they are received by the
Commerce Bankcard Center. Invoices for JPMorgan Chase centrally billed travel
accounts are considered received when both the JPMorgan Chase bill and the
reconciling information from the Travel Management Center are received.
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.02 Required Notices to Contractor/Vendor Payees
Submission by a contractor/vendor of an Invoice that is not a Proper Invoice is no
submission at all. When an organization unit determines that an Invoice is not
proper, it must be returned to the Payee within 7 days. Failure to do so reduces the
number of days available (30) by the number of days past 7 it took to return the
defective Invoice to the Payee to make the necessary payment without incurring an
interest penalty payment. Copies of improper Invoices, with notations of the date
returned to the Payee, should be kept in a central file for reference.
.03 Summary Invoice
The vendor or contractor will submit a Summary Invoice monthly or within 60 days
after expiration of the Blanket Purchase Agreement (BPA), whichever occurs first,
for all deliveries made during the month. All Delivery Tickets covered should be
identified, with the total dollar value stated, and supported by receipted copies of
the Delivery Tickets.
Vendors or contractors not submitting monthly summary billings, as required under
the BPA, will be paid per call order. Billings received between the first and last day
of the month will be paid within 30 days from the last day of the month.
Section 6.0 “Receiving Reports”
The following information is required on a proper “Receiving Report”:
1. Contract or other authorization number;
2. Product or service description;
3. Quantities received, if applicable;
4. Date(s) property or service was delivered and accepted;
5. Signature (or electronic alternative when supported by appropriate internal
controls);
6. Printed name, title, telephone number, mailing address, and E mail address of
the receiving official. Taxpayer Identification Number (TIN) if available.
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Organization units will ensure that receipt and acceptance are executed as promptly as
possible, or before expiration of the permitted acceptance period, if such a period is
specifically stated in the Contract or “Purchase Order”. “Receiving Reports” must be
sent in time to be received by the payment center by the fifth business day after receipt
or acceptance of goods or services. Since the late receipt of these reports is the primary
reason for late payments, it is incumbent upon the payment offices to work closely with
appropriate offices throughout their organization unit to ensure that Receiving Reports
are forwarded in a timely manner. Designated receiving and payment offices must date-
stamp “Receiving Reports” and Invoices as they are received in that office. Where
performance does not satisfy the provisions of the contract, the payee will be notified as
soon as possible by the responsible purchasing or contracting office.
Section 7.0 Timing Considerations in the Payment of Invoices
The “Timely Payment Period” starts with receipt of a “Proper Invoice” and ends with the
“Payment Due Date.” The “Timely Payment Period” is the period available for making a
payment without incurring interest.
Exceptions:
• Invoices for JPMorgan Chase Purchase Card services are considered “received”
on the date that they are received by the Commerce Bankcard Center (CBC).
• Invoices for JPMorgan Chase centrally billed travel accounts are considered
received when both the JPMorgan Chase bill and the reconciling information
from the Travel Management Center (TMC) are received.
.01 Determining Payment Due Dates
Basically, unless otherwise specified, payment is due either:
• On the date specified in the contract; or
• If a Payment Due Date is not specified in the contract, it will fall 30 days
after the start of the Timely Payment Period.
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.02 Exceptions Under Which Due Dates Can Vary
a. Payment Due Dates vary for different food commodities (e.g., meat or meat food
products, perishable agricultural commodities, or dairy products), refer to:
1. Perishable Agricultural Commodities Act of 1930 (7 U.S.C. 499) for meats;
or
2. Dairy Production Stabilization Act of 1983 (7 U.S.C. 4501-4514) for dairy.
3. For specific products, contractual Payment Due Dates should be determined
by prevailing industry practices.
b. When Invoices containing items with different payment periods are received,
organization units:
1. Should pay in accordance with the payment provisions of the Contract;
2. Must pay an interest penalty if some items are paid for after their due dates;
3. May split payments, making payment by the due date applicable to each
category;
4. May, take discounts for partial deliveries, if offered, when payment is made
within the discount period;
5. May not require contractors to submit multiple Invoices for payment of
individual orders by the organization unit; and
6. May encourage, but may not require contractors to submit separate Invoices
for categories of products with different payment periods.
Section 8.0 Purchase Discounts and Rebates
Vendors offer a variety of price reductions (discounts): volume discounts, payment-by-
cash discounts, time discounts, etc. Vendors may also offer rebates, which are refunds of
part of the sales price or fee in consideration for early payment. This section is primarily
concerned with “Time Discounts” for early payments as they relate to the Prompt
Payment Act.
Economically justified discounts should be taken within the “Discount Period” whenever
offered by the contract document or Invoice. Normally, discounts B even Prompt
Payment Discounts may be taken only after acceptance of goods or services has occurred
except where a lawful agreement provides otherwise.
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Payment officers must maintain a record of all lost economically justified discounts for
reporting purposes. Organization unit payment systems are to include procedures that
take advantage of cash discounts as a matter of routine. Such procedures should expedite
the handling of Invoices offering cash discounts. For further guidance on taking cost-
effective discounts, see TFM Volume I.
Organization units should continuously review ways for improving early identification of
Invoices involving discounts. These procedural and operational reviews should include:
1. Determining which discounts are economically justified for early payment;
2. Placing appropriate Invoices on a "fast pay track"; and
3. Immediate follow-up to obtain the “Receiving Report” where such special
handling is warranted.
4. Such action must be cost-effective in terms of the discount involved.
.01 Time Considerations in Taking Discounts
For an organization unit to accept the offered discount, the unit need only properly
send payment. The date of mailing the check is controlling, not the date of receipt
by the payee. Electronic Funds Transfer (EFT) is encouraged. If the time provided
by the Contract is given as a certain number of days, the word "days" refers to
calendar days and not working days, unless otherwise stated. On Saturdays,
Sundays, and legal holidays, when Government offices are closed and Government
business is not expected to be conducted, payments falling due may be scheduled
for the next business day without losing the discount.
When a cost-effective cash discount is offered, the applicable Invoice must be
processed promptly to avoid loss of discount. Disbursing Vouchers for Invoices
with cash discounts will be prepared and sent to the Department of the Treasury to
permit check issuance as close as possible to, but no later than, the last day of the
discount period. A payment made by Electronic Funds Transfer (EFT) will be made
on the last day of the discount period.
The period for taking a discount, the “Discount Period”, is calculated from the
“Discount Date” placed on the Proper Invoice by the contractor. When a Time
Discount is taken, payment will be made as close as possible to, but not later than,
the discount date. However, if the contractor has not ‘dated’ the Invoice, the
Discount Period will begin on the date a Proper Invoice is actually received by the
designated Billing Office assuming that the organization unit has annotated the
Invoice with the date when the item(s) listed on such Invoice were received.
.02 Invoice Payments and Compliance with the Prompt Payment Act
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a. Purchase Cards Purchases
Pending JPMorgan Chase’s actions to ensure sufficient information on Invoices for
processing payments, the following policy applies to Purchase Cards:
The Prompt Pay “Clock” starts running with the date printed on the Invoice
generated by the Commerce Bankcard Center (CBC).
Note: The date currently used is the Business day after the 21st of the month.
The Prompt Pay interest payment should be made as a separate payment.
b. Centrally-billed Travel Account Purchases
Since detailed travel information has had to flow through JPMorgan Chase and the
Travel Management Center (TMC) prior to its receipt by the Cardholder:
The Prompt Pay “Clock” does not start running until the Cardholder receives both
the Hard Copy “Invoice” from Citibank and the reconciled travel data from the
responsible TMC.
Prompt Pay interest payment should be made in a separate payment.
c. Accelerated Payments
Accelerated Payments are payments made prior to the verification of receipt of
merchandise as permitted in certain circumstances, such as the taking advantage of
rebates.
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Section 9.0 Late Payment Interest Penalties
When an organization unit fails to make payments when due, interest penalties will be
paid pursuant to the guidelines provided below. Organization units will pay such interest
penalties without the need for Payees to request them. Organization units shall pay
interest out of funds made available for the administration or operation of the program for
which the penalty was incurred. Bureaus may, when reasonable, charge interest penalties
back to the applicable program office(s).
.01 Conditions Requiring Interest Payment
Interest will be paid when all the following conditions are met:
1. Contract or Purchase Order with a payee subject to the Prompt Payment Act;
2. A proper Invoice has been received (except where no Invoices are required,
e.g., some periodic lease payments);
3. Acceptance of property or services has occurred and there are no disputes over
quantity, quality, or other contract provisions; and
4. Payment is made to the payee after the due date.
5. Payment of interest is also required when an organization unit takes a discount
after the discount period has expired, and fails to correct the underpayment by
the payment due date.
When an organization unit pays a late payment interest penalty, such payment must
be accompanied by a statement that provides:
1.The amount of the interest;
2.The interest rate currently in effect; and
3.The number of days covered by the penalty payment.
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.02 Situations in which interest penalties need not be paid:
1. Payments made on time in accordance with the Prompt Payment Act or in
accordance with the terms of the agreement;
2. Progress payments made solely for financing purposes where items of
property or services have not been delivered or performed;
3. Payment is delayed because of a dispute between an organization unit and
a payee over the amount of the payment or other issues concerning
compliance with the terms of a contract while the dispute is being settled
in accordance with the Contract Disputes Act of 1978, as amended;
4. Interest amounts to less than one dollar;
5. Payments made in advance for such things as rent, tuition, subscriptions,
etc., unless interest penalty terms are specified in the procurement
document;
6. Costs or fees temporarily withheld in accordance with the terms of the
contract; or
7. When an organization unit cannot complete transmission of payment to a
contractor by EFT because of incorrect or incomplete account information
provided by the contractor. The organization unit is exempted from
payment of interest penalties for the period between the date of attempted
transmission and the date on which the Payee supplies correct information
to the organization unit, provided that the Payee has been given notice of
the defective account information within seven days after the organization
unit is notified of the defective information.
Section 10.0 Additional Penalties
.01 Conditions
A payee is entitled to an additional interest penalty payment equal to one hundred percent
(100%) of the original late payment interest amount when the payee meets all of the
following conditions:
1. Is owed a late interest payment by an organization unit;
2. Received a payment late that did not include an interest penalty that was due;
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3. Was not paid the interest penalty within ten days of such late payment; and Makes
a written request not later than forty days after the payment was made. (The
Payee’s written request must specifically identify the Invoice for which late
payment interest is overdue, and request payment of all late payment interest
penalties and additional penalties.)
Bureaus may, when reasonable, charge interest penalties back to the applicable program
office(s).
.02 Limitations of the Penalty Amount
The additional interest penalty is subject to limitations as follows:
1. The maximum additional penalty shall not be greater than $5,000.
2. The minimum additional penalty shall not be less than twenty-five dollars
regardless of the amount of the late payment interest penalty.
3. Maximum and minimum penalties shall be determined on each separate payment
made for each separate contract.
.03 Administrative Constraints regarding Additional Interest Penalties
The penalty shall not be based on individual Invoices unless such Invoices are paid by
separate payments. Where payments are consolidated for disbursing purposes, the
penalty determination shall be made separately for each contract. Additional interest
penalties do not cease to accrue at the end of one year as does the late payment interest
penalties. Additional penalties do not apply to the payment of utility bills, because late
payment penalties for these bills are determined through the rate-setting process.
Section 11.0 Applicable Interest Rate
The interest rate to be used for calculating interest penalties (except in cases where a
different interest rate is prescribed by another governmental authority) is that which is in
effect on the day after the due date. It is established by the Secretary, Department of the
Treasury and is variously referred to as:
1. the "Renegotiation Board Interest Rate,"
2. the "Prompt Payment Act Interest Rate," or
3. the "Contract Disputes Act Interest Rate."
4. It is published semi-annually in the Federal Register on or about January 1 and
July 1 and can also be obtained from the following web site:
Treasury Direct Website - Prompt Payment Act Interest Rate
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Section 12.0 Calculation of Interest Penalties
Organization units will adhere to the following guidelines for calculating interest due on
late payments.
The Prompt Payment Act interest rate in effect on the day after the due date will be the
interest rate used in calculating the late payment interest. Interest will be computed from
the day after the due date (i.e., the thirty-first day) through the expected payment date.
Adjustments will be made for errors in estimating the date of the payment if requested by
the Payee and if the penalty exceeds one dollar.
When an interest penalty that is owed is not paid, interest will accrue on the unpaid
amount until paid (except in cases described in "g" below). Interest penalties remaining
unpaid for any thirty-day period will be added to the principal. Thereafter, subsequent
interest will accrue monthly on the total amount of principal and previously accrued
interest. When an organization unit takes a discount after the discount period has
expired, the interest payment will be calculated on the amount of the improper discount
taken, beginning the day after the end of the specified discount period through the
expected payment date.
When an organization unit fails to notify the Payee within seven days that an Invoice is
improper, the time allowed for payment of the, subsequently submitted, corrected Proper
Invoice will be reduced. The difference between the seventh day after receipt of the
Improper Invoice and the day notification was actually transmitted to the Payee will be
subtracted. Calculation of interest penalties will be based on an adjusted due date
reflecting the reduced number of days allowable for payment.
Interest penalties shall not continue to accrue after the filing of a claim for such penalties
under the Contract Disputes Act of 1978, or for more than one year.
Section 13.0 Quality Control Program (QC)
Each organization unit must establish a QC program to assess performance of payment
systems, and to provide a reliable way to estimate payment performance. Such QC
programs must fulfill the following requirements:
.01 Accuracy and Consistency
The QC program must be a systematic performance measurement system that
provides managers with information about problems and assists in targeting
corrective action(s) throughout the organization unit. QC data must be accurate
(within established tolerances) and consistent. It will be used in developing annual
as well as other reports and should be useful in budget development. QC reviewers
must use original documents and repeat the original calculations.
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.02 Currency
Data should be gathered as frequently as needed by managers to identify and correct
errors. Information must be collected through a process at least as thorough as the
original payment decision process.
.03 Efficiency
Where the number of payment actions is too numerous to permit a total review, data
should be gathered on the basis of a statistically valid sample sufficient to assure the
reliability of QC reviews.
.04 Objectivity
Data must be collected by individuals who are independent of the original payment
decisions. Supervisory reviews are not to be considered QC reviews. Analysis of
QC data should result in remedial action targeted to correct objectively determined
error causes.
.05 Utility
Analysis of QC data should result in remedial action to correct the causes of errors.
Each organization unit will establish an inquiry section(s) within each payment
office for answering payee inquiries. If formally structured, such formal delegations
of responsibility should be provided by the Chief Financial Officer of the payment
office. Each organization unit will submit, to the Director for Financial
Management, an abbreviated semi annual report to assist management in identifying
Prompt Payment performance trends (Exhibit F-1).
Payment Offices should maintain records containing information such as the following:
1. Invoices Paid Subject to Prompt Payment: Dollar Value; and Number.
2. Invoices Paid Late: Dollar Value, Number, and Relative Frequency.
3. Late Payment Interest: Dollar Value; Number; and Relative Frequency.
(Please refer to Exhibit F-1)
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It would be helpful also to maintain records with regard to the following:
1. Invoices paid eight days or more before the due date, except where cash discounts
or rebates are taken -- number, dollar value, and relative frequency of invoices
that are subject to, as well as those not subject to Prompt Pay Requirements.
2. The Number of Discounts available -- whether taken or “passed-up” due to
inadequate economic justification (as well as the reasons for same).
3. Description of the organizational unit’s payment practices.
4. Description of the organizational unit’s Quality Control System.
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Exhibit F-1
Bureau: ________________ Date: ___________
Prompt Payment Information
I. Invoices Paid Subject to Prompt Payment Act
• Dollar Value
• Number of Invoices
II. Invoices Paid Late
• Dollar Value
• Number of Invoices
• Relative Frequency
III. Late Payment Interest Penalties Paid
• Dollar Value
• Number of Invoices
• Relative Frequency
