Defining Late Interest Charges

To define late interest charges, use the following components:

Late Interest Charges (LATE_CHRG_TBL).
Late Chrg Chartfield Override (late charge ChartField override) (LATE_CHRG_CF).
Payment Reason Codes (PYMNT_REASON_CD).

This section provides an overview of late interest charges and discusses how to:

Define late interest charges.
Override late charge ChartFields.
Define payment reason codes.

Pages Used to Define Late Interest Charges

Page Name	Definition Name	Navigation	Usage
Late Interest Charges	LATE_CHRG_TBL	select Set Up Financials/Supply Chain, then select Product Related, then select Procurement Options, then select Payments, then select Late Interest Charges, then select Late Interest Charges	Define late charge interest rates.
Late Charge ChartField Override	LATE_CHRG_CF	select Set Up Financials/Supply Chain, then select Product Related, then select Procurement Options, then select Payments, then select Late Interest Chrg Chartfields, then select Late Charge ChartField Override	For a particular Fund Code, replace particular ChartField values for the late interest charge distributions defined on the Accounting Entry Template and by inheritance.
Payment Reason Codes	PYMNT_REASON_CD	select Set Up Financials/Supply Chain, then select Product Related, then select Procurement Options, then select Payments, then select Payment Reason Codes, then select Payment Reason Codes	Assign reason codes to late payments to explain why the payments are late.
Late Charge Information	LATE_CHRG_SBP	select Accounts Payable, then select Vouchers, then select Add/Update, then select Regular Entry, then select Payments Click the Late Charge link on the Voucher - Payments page.	Override late interest charge information for a voucher.

Understanding Late Interest Charges

If you enable late interest charges on the Installation Options - Payables page, the system can automatically calculate interest charges for late payments to suppliers. Once you have set up the late interest charges, you can define late charge options at the PeopleSoft Payables business unit, origin, supplier and voucher levels of the control hierarchy.

Late interest charge calculation is primarily a U.S. federal feature.

Note: Late charges are calculated during pay cycle processing. They are calculated on the voucher gross amount and, once calculated, converted from the invoice currency to the payment currency, if necessary.

Late Interest Charges Page

Use the Late Interest Charges page (LATE_CHRG_TBL) to define late charge interest rates.

Navigation

select Set Up Financials/Supply Chain, then select Product Related, then select Procurement Options, then select Payments, then select Late Interest Charges, then select Late Interest Charges

Interest and Minimum Amount

Interest Rate

Enter the interest rate used to calculate late charges.

Minimum Pay Amount

Enter a threshold for the calculated late interest charge below which it will not be paid.

Penalty

Check to indicate that this is a late charge assessed directly by the supplier. Such charges are reported in Section E (Other Penalties) of the Prompt Payment Report (APS2001).

Interest Calculation Days

Days in Year

Enter the days in the year based on the business needs. Some organizations choose 365 but, for others, 360 is a better choice.

Simple Interest Days

Enter the days subject to simple interest. The system calculates compound interest on the number of days the payment is past due minus the number of simple interest days.

Max Pay Days (maximum pay days)

Enter the maximum number of days the system computes interest.

Late Charge ChartField Override Page

Use the Late Charge ChartField Override page (LATE_CHRG_CF) to for a particular Fund Code, replace particular ChartField values for the late interest charge distributions defined on the Accounting Entry Template and by inheritance.

Navigation

select Set Up Financials/Supply Chain, then select Product Related, then select Procurement Options, then select Payments, then select Late Interest Chrg Chartfields, then select Late Charge ChartField Override

Late charges are charged to late charge accounting entries generated by the late charge distribution defined on the Accounting Entry Template and by inheritance. You can override these distributions with other ChartField values for a particular Fund Code.

For example, if the budget has expired, you could override late charge ChartFields to hit an active budget. In this case, if you override the ChartFields, you must enter a budget start date, budget end date, and account. The additional ChartFields are optional for override.

Payment Reason Codes Page

Use the Payment Reason Codes page (PYMNT_REASON_CD) to assign reason codes to late payments to explain why the payments are late.

Navigation

select Set Up Financials/Supply Chain, then select Product Related, then select Procurement Options, then select Payments, then select Payment Reason Codes, then select Payment Reason Codes

Definition Option

User Applied

Select to manually assign reason codes to individual payments at the voucher level.

System Applied

Select to automatically inserts reason codes at the business unit definition level.

Reason Code Type

Early, Late, or Cancel

Indicate whether this reason code applies to a payment that is early , late or one that is cancelled.