{"id":4361,"date":"2021-04-23T15:56:16","date_gmt":"2021-04-23T15:56:16","guid":{"rendered":"https:\/\/www.peeriosity.com\/shared-services\/articles\/?p=4361"},"modified":"2022-08-23T17:48:44","modified_gmt":"2022-08-23T17:48:44","slug":"paying-invoices-with-immediate-payment-terms","status":"publish","type":"post","link":"https:\/\/www.peeriosity.com\/shared-services\/articles\/2021\/04\/paying-invoices-with-immediate-payment-terms\/","title":{"rendered":"Paying Invoices with Immediate Payment Terms"},"content":{"rendered":"\r\n

Introduction<\/strong><\/p>\r\n\r\n\r\n\r\n

Shared Services work processes, like Accounts Payable (P2P)<\/a> have hundreds of detailed work steps and many required policy differences depending on the type of supplier, negotiated terms, industry standards, and legal or regulatory requirements.\u00a0 \u00a0As companies work to implement the most efficient processes possible, understanding the details of how other peer companies handle similar situations can be very valuable.<\/p>\r\n\r\n\r\n\r\n

Fortunately, for Peeriosity members, it\u2019s easy to draft an iPollingTM<\/sup> question and instantly find out how other members tackle the problem, with the ability to directly follow up with other participants for further discussion and dialogue.\u00a0 With Peeriosity, your poll will go to hundreds of members for a possible response, with those that have knowledge providing inputs that are likely to be directly on point to solve your issue, all at no cost to you. \u00a0Plus, the exchange is completely private, with only members whose companies provided an answer to the poll questions able to access the detailed results and findings.<\/p>\r\n\r\n\r\n\r\n

iPollingTM<\/sup> Results Review<\/strong><\/p>\r\n\r\n\r\n\r\n

Recently a Peeriosity iPollingTM<\/sup> question was created to better understand the approach member companies take to paying invoices<\/a> with immediate payment terms<\/a>.\u00a0 Note that the assumption is that immediate payment is approved and appropriate, and not made simply because the invoice indicates \u201cNet 0\u201d or otherwise the payment is required upon invoice receipt.\u00a0 Even so, when approved and appropriate, \u201cimmediate payment\u201d obviously suggests quickly, but likely doesn\u2019t often meet the requirements to drop everything and process a wire transfer with the bank or create an on-demand check for manual signature. \u00a0So, in other words, if it\u2019s not \u201cright now\u201d what does \u201cimmediate payment\u201d really mean?<\/p>\r\n\r\n\r\n\r\n

Based on the approach taken by 39% of Peeriosity member companies, \u201cimmediate payment\u201d is to make the payment on the next payment run after the invoice is received and processed, regardless of the invoice date.\u00a0 An additional 44% make the payment within a fixed number of days, with 33% basing the number of days on the invoice date, and 11% basing the number of days on the date the invoice is received.\u00a0 The balance of 17% follows another process, which typically is one of the listed options, with the ability to make adjustments as required to meet business needs.\u00a0 Here are the details:<\/p>\r\n\r\n\r\n\r\n

\"results<\/figure>\r\n\r\n\r\n\r\n

To further understand the responses, for companies who were in the category of paying based on a fixed number of days from either the invoice date or the date the invoice was received, the question was asked for insight into how many days would be typically allowed to be considered as paid-on-time.\u00a0 The differences here were significant, with 45% indicating 1 to 2 days, and the balance of 55% indicating anywhere from 7 to 10 days.<\/p>\r\n\r\n\r\n\r\n

\"ipolling<\/figure>\r\n\r\n\r\n\r\n

Here are some of the comments from responding companies that provide additional insight into the approaches member companies take to these types of transactions:<\/p>\r\n\r\n\r\n\r\n