You are here: Chapter XII Expenditures > 5. Agency Payment Preparation and Submittal > I. Merchandise/Invoice Received Dates and Prompt Payment Interest Calculations

XII.5.I
Merchandise/Invoice Received Dates and Prompt Payment Interest Calculations

SECTION OVERVIEW AND POLICIES

 

Prompt Payment interest is due in instances where New York State does not issue payment within 30 days of receipt of goods or services and a proper invoice.

 

 

Process and Document Preparation:

 

The Statewide Financial System (SFS) determines the number of days between the Merchandise/Invoice Received (MIR) Date and the Scheduled Payment Date, determines whether the payment is late, calculates the interest due and if the interest due is $10 or more, processes the interest payment with the original payment on the invoice.

 

When processing payments to a vendor, Business Units must record the date the designated payment office received a proper invoice in the Invoice Received Date field of the voucher.

 

The MIR date is the date on which the Business Unit receives the goods/services or a proper invoice, whichever is later. A proper invoice is one which provides accurate prices, quantities and descriptions of goods/services delivered, and contains supporting documentation that the Business Unit and the Office of the State Comptroller (OSC) may reasonably require. Business Unit fiscal staff is responsible for determining the correct MIR date, which determines if a vendor is entitled to interest under prompt payment legislation.

 

Differences in processing Prompt Payment Interest in the SFS include:

 

 

If payment is not made within 30 days of the MIR date, interest will be calculated and if due, automatically paid to the vendor. Business Units must consider the following situations when establishing the MIR date:

 

CALCULATING MIR DATE

 

IF THEN THE MIR DATE IS
1. the vendor delivers an invoice somewhere other than the payment office designated by the Business Unit,

1. the date the designated payment office receives the invoice.

 

(NOTE: Business Units must designate payment offices on the purchase order or contract when the billing address differs from the shipping address.)

2. the goods/services delivered are defective, the invoice is defective, and/or there are suspected improprieties of any kind,

2. increased by the number of days it takes to correct the defect or impropriety.

 

NOTE: Agencies are responsible for notifying vendors of such defects/improprieties within 15 calendar days of receiving the invoice. If vendors are not notified in 15 days the 'increased MIR date' is reduced by the number of calendar days in excess of 15 taken to notify the vendor.

For example, if a defective invoice is received on 4/1, the vendor is notified on 4/3 (within 15 days), and the defect is corrected on 4/5, then the MIR date is 4/5. However, if a defective invoice is received on 4/1, the vendor is notified on 4/21 (5 days late) and the defect is corrected on 4/23, then the MIR date is 4/18 (4/23 minus 5 days).

3. an inspection period or audit is specifically required by statute or contract provision, 3. increased up to the number of calendar days allowed for the inspection or audit.
4. an invoice must be examined by the federal government prior to payment, 4. increased by the number of calendar days required for the examination.
5. the applicable appropriation has yet to be enacted (passed and signed),

5. increased by the number of calendar days between receipt of the invoice and enactment of the legislation.

 

Exceptions:

 

  • Appropriations for the Legislature and Judiciary, which must be approved by the Governor
  • Any separate appropriations added to the Governor’s budget bills by the Legislature, which become law when signed by the Governor
  • Any items vetoed that are separately reconsidered by the Legislature and, if on reconsideration, are approved by two-thirds of the members elected to each house
6. legislation or a contract provides that payment will be paid on a predetermined date without having to submit an invoice, 6. the predetermined date less 30 calendar days.
7. OSC determines that there is reasonable cause to believe that payment may not properly be due in whole or in part, 7. increased by the number of calendar days taken to resolve the matter.
8. the payment is not eligible for interest and is not initiated by an invoice,

8. the date that best represents the beginning of the payment cycle so the system can monitor payment processing time.

 

For example, crime victim compensation awards are based on an award decision by the Office of Victim Services. The date of the award decision may best represent the start of the payment cycle and can be entered as the MIR date.

 

Online Business Units

 

The SFS compares the Invoice Received Date of the voucher to the Merchandise Received Date or Merchandise Inspection Date from the purchase order (if applicable) and calculates the MIR date, which determines if the vendor is owed interest. There may be instances where Business Units must adjust the MIR date, either in accordance with the Calculating MIR date chart above, or if there is no purchase order associated with the voucher. In these instances, the Business Unit should enter the computed MIR date into the Invoice Received Date field. Note: This may be different from the date the invoice was received.

 

All vouchers submitted for payment via SFS are defaulted to calculate interest due. To indicate the payment is not interest eligible, the Business Unit must access the “Late Charge” hyperlink in the voucher. In the “Late Charge Information” drop down menu, the Business Unit must change the “Late Charge Option” field to “Not Applicable”.

 

Bulkload Business Units

 

The SFS does not calculate the MIR date. Business Units must calculate the MIR date based on the date the Business Unit receives the goods or services, or a proper invoice (whichever is later).

 

Business Units must also identify if the vendor is eligible for an interest payment by indicating an “N” for no and “Y” for yes in the interest eligible field (INTELIG) of the voucher.

 

 

Guide to Financial Operations
REV. 03/19/2012