Understanding Progress Payments

You make progress payments to the subcontractors as they make progress against their contracts. You draw progress payments from the funds that are committed to their contracts.

To make a progress payment, you must first enter a voucher into the JD Edwards EnterpriseOne Subcontract Management system. Vouchers contain the details of a payment and enable you to create a payment that is drawn against the commitments for a contract. After you enter a voucher, you can review and post it. You can then work with the voucher to change the method that the system uses to process payments. You can also correct a voucher that was entered incorrectly.

Note: The terms voucher and progress payment have the same meaning in the JD Edwards EnterpriseOne Subcontract Management system and the JD Edwards EnterpriseOne Procurement system.

In addition, you make progress payments to release some or all of the retainage against a contract. Retainage is a percentage of the committed amount that is held until a specified date after the completion of the contract.

When you are ready to make payments, you can process progress payments.

You can also set threshold amounts for progress payments. The currency that you specify in the Supplier Master (P0401) is used as the default currency for the threshold amount. During progress payments, the system checks to determine whether a voucher exceeds the threshold specified in the Subcontractor Threshold program (P4355). If the threshold amount has been exceeded, the system places the voucher on hold. The voucher is then on a pay status code hold. You can set vouchers on pay status holds for threshold by setting the processing options for the Process Tab-Threshold pay status code on the Voucher Match, or Progress Payment, program (P4314).

For a progress payment and retainage release, you enter a cumulative percent or amount of the total. Thus, you do not have to precalculate the pay amount when you have only the percent complete available.

You enter progress payments for quantities that exceed the original contract estimates if this is a permissible business practice. This functionality eliminates the requirement to enter change orders, thus increasing process efficiency.