The Define Payment Terms Types window specifies payment terms for the Due Date Calculation process. The payment term automatically calculates the payment due date in compliance with the Prompt Payment Act.
The Prompt Payment Act requires federal agencies to calculate the payment due date of a vendor invoice by using the later of the date the invoice was received or the date goods or services were accepted by the agency. The payment period begins with the date selected.
Payment Terms Types are required to run these features:
Due date calculation
Prompt Payment Statistical Report
Payments Without Reason Codes Report
The Terms Type option, specified in the Define Payment Terms Types window, is required for Due Date Calculation and for compliance with the Prompt Payment Act.
The Payment Terms Type also defaults to purchase orders and invoices generated for a specific vendor.
Note: If Prompt Pay is not selected as the Payment Terms Type, invoices are not included in the due date calculation, and the Terms Date Basis in the standard Payables is used as the due date.
Before setting up payment terms types, you must:
Set up payment terms in Payables before processing payments for the first time.
Ensure Invoice Received Date is selected as the Terms Date Basis in the Supplier region of the Payables Options window before processing payments for the first time. This must be set up in Payables.
Related Topics
To define payment terms options, navigate to the Define Payment Terms Types window.
The following table describes selected fields on the Define Payment Terms Types window
| Field Name | Description |
|---|---|
| Name | Name for the Payables terms type |
| Description | Description of the Payables terms type |
| Terms Type | Payment terms types |
| Description | Description of the payment terms type |
| Constructive Acceptance Days | Number of days to accept goods or services after receipt of goods or services |
| Invoice Return Days | Number of days to return invoice when defective supplier invoices are returned |