Delayed Charging

Suppliers will sometimes invoice clinics for goods, but allow the clinics to pay for those goods 1, 2 or 3 months later. There are several considerations in processing delayed payments including keeping stock levels accurate, paying GST in the correct period and paying the supplier in the correct period.

The following processing methods are suggested. Please also seek advice from your accountant.

Maintenance Setup

Set VisionVPM to use Delayed Charges option in Maintenance.

Go to: Main menu > Maintenance module > Maintenance menu > System Defaults > Finance tab.

Select the Supplier Invoices option in the Delayed Charges Usage area.

If you are going to use delayed payments for clients as well, select the Client and Supplier Invoices option.

When the invoice is forward dated

For example, you receive the goods 10 January, but the invoice date is 1 March, payment due 20 April.

When you receive the goods (10 January), create a Goods Receipt (or convert the Goods on Order to a Goods Receipt) to enter the stock into your system.

This enters the stock into your inventory at the date you receive it, updating stock levels.

Step 1: Goods on Order

Step 2: Converting from Goods on Order to Goods Receipts

1. When you receive the invoice (received 12 January, dated 1 March), convert the Goods Receipt to an Invoice with the invoice date as printed on the invoice (1 March).
2. Stock levels will remain correct from date of Goods Receipt entry.
3. The Supplier Invoice will be available for payment in the Supplier Payment Run
4. The purchase and GST amounts will be in the period appropriate to the Invoice (or Payment).
5. Enter the Charge Date as 20 April 2010.

Step 3: Converting from Goods Receipts to Invoice

Step 4: Payment of Invoice re Charge Date

When the invoice has a current date, but payment due date is deferred

For example, if you receive the goods 10 January, and the invoice date is 10 January, but payment is not due until 20 April.

When you receive the goods, enter invoice as per sample below. Date invoice / goods received, note the Charge Date: enter the date this invoice is due to be paid.

Step 1: Creating Invoice

Step 2: Creating Payment dated 20.04.10

Supplier Invoice with Split Payments

For example, you receive the invoice and goods dated 10 January but 2 payments of equal amount due March and April.

You will need to set up a Deferred Payment general account if this is not already done.

To create this account:

1. Go to: Main menu > General Ledger module > General Ledger menu > Chart of Accounts > Insert.
2. Enter the general ledger Account Code and Description.
3. Mark the account as a Current Liability and Zero Rated for GST.

Step 1: Enter the supplier invoice to receipt goods and charge the Deferred Payment account.

1. Select the Supplier and click Invoice.
2. Enter Invoice No, User Code and invoice Date.
3. Enter all stock items received.
4. To enter the Deferred Supplier Payments account, tab to GL A/c and enter the general ledger code for Deferred Supplier Payments.
5. Tab to Description and enter the Supplier name and the products.
6. Tab through to Total and enter the total including GST amount as a negative amount.
7. Click Save.
8. The Total of the invoice should be 0.00.

Step 2: Enter invoices to cover the split deferred amounts

You will need to enter a delayed charge invoice for each month that the payment will be split.

In this example, payment is to be split over two months; March and April, therefore two invoices are required.

1. Enter the invoice number with a D at the end to identify it's a delayed charge invoice.
2. Enter the Charge Date as the beginning of the 1st payment month.
3. Tab to the GL A/c field and enter the code for the Deferred Supplier Payment.
4. Enter the Total as the amount of the payment split over the number of months.

In the screenshot below, the Charge Date is 1 March 10 with the Total of 967.50, being half of the original invoice.

You would then need to enter another invoice with a Charge Date of 1 April 2010 as shown below:

As each of above invoices became due, you would receipt payment either through Supplier Payment Run or on the individual supplier.