The Prompt Payment act and Voucher Examination

Personnel responsible for Federal contractor and vendor payments are bound by the Prompt Payment Act, which requires the timely payment of vendor invoices. If you fail to comply with the regulations outlined in this Act, interest payment penalties are incurred. You will learn about the budgetary implications of late payments, how to avoid these penalties, and the appropriate use of funds. You will also gain an understanding of how to calculate interest and the year-end closeout procedures to address late payments.

Learning Objectives

• Certify a voucher for completeness and accuracy
• Discuss the implications of the liability of certifying officers and the avenues of relief for liability
• Describe the legislative history of the Prompt Payment Act
• List the general requirements of the Prompt Payment Act
• Differentiate between items that are, and are not, subject to the Prompt Payment Act
• Describe the federal payment process
• Describe benefits of a well-implemented Prompt Payment process
• Calculate the appropriate due date for an invoice given a mix of factors, including available discounts
• Discuss when a payment cycle should be stopped and how it can be restarted
• Calculate the financial impact of a discount to determine if taking it is the best course of action
• Calculate effective rebate rate
• Calculate interest due on a late payment

Course Topics

Voucher Examination

• Building Background
• Purpose of the “Vendor Pay” Business Process
• Terms and Concepts
• Common Payment Forms
• The Vendor Pay Documentation Process
• Voucher Examination – Initial Exam and Certification
• Principal Concerns in the Voucher Examination and Certification Process
• Roles and Responsibilities
• The Payment Process
• Supporting Documents
• Document Information
• Special Certification Requirement
• Exercise: Voucher Examination
• Electronic Certification
• Certifying Officer Liability

Prompt Payment Act Introduction

• Building Background
• Legislative History and Guidance
• The Federal Payment Process

Payment Due Dates

• Building Background
• Terms and Concepts
• Determining When a Payment Is Due
• Net Payment Cycle/Process
• Additional Guidance on Payment Due Dates
• Payment Due Date – Additional Guidance
• Exercise: Payment Due Date

Economical Discounts and Rebates

• Building Background
• Determining When to Take a Discount
• Working with Rebates

Interest Penalties

• Building Background
• Types of Interest Penalties
• Late Payment Interest Calculation Procedures
• Budgetary Implications
• Penalty Payment Procedures: Additional Guidance
• Exercise: Capstone