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Payment practices and performance reporting – are you ready? We can help.

From April 2017, all medium and large UK companies now have a duty to report publicly on their payment policies, practices and performance.  This new requirement, will need careful consideration, both to ensure compliance and also manage the likely public scrutiny.

Who does this affect?

It will impact any company or LLP that exceeds at least two of the following three thresholds in the last two preceding financial years:

  • £36m annual turnover
  • £18m balance sheet total
  • 250 employees

This legislation also applies to charitable companies (including companies limited by both shares and by guarantee) and community interest companies.

Posted 18/12/2017

When does it need to be done by?

The regulation applies to financial years beginning on or after 6 April 2017.

Reporting is due within 30 days of each six month period and will be aligned with the business’s key financial reporting dates. For example, first submissions for companies with a December year-end will become due on July 2018. Companies with an April year end will have to report as early as 30 November 2017.

What do you need to include?

Your report will need to include the following:

  • The average number of days taken to make payments to suppliers in the reporting period, from the date of receipt of invoice or other notice.
  • The percentage of payments made within the reporting period which were paid in 30 days or fewer, between 31 and 60 days, and in 61 days or longer.
  • The percentage of payments due within the reporting period which were not paid within agreed terms.

You will also need to provide the following narrative and statements:

  • Your business’s standard payment terms, which must include:
    • the standard contractual length of time for payment of invoices
    • maximum contractual payment period
    • any changes to the standard payment terms in the reporting period, and how suppliers have been notified or consulted on these changes.
  • Your business’s process for resolving disputes related to payment.
  • Whether suppliers are offered e-invoicing
  • Whether supply chain finance is available to suppliers
  • Whether your business’s practices and policies cover deducting sums from payments as a charge for remaining on a supplier’s list, and whether they have done this in the reporting period
  • Whether your business is a member of a payment code, and the name of the code.

Act now and ensure you achieve straightforward, easy compliance with this new legislation

You can find out more about this upcoming legislation at https://www.gov.uk/government/publications/business-payment-practices-and-performance-reporting-requirements

 

Access customers can use their existing software, together with a bespoke reporting package we have made available, to report on this quickly and easily.

We also help our customers improve their performance in this area through aCloud Capture – helping to streamline the accounts payable process.

 

 

Our aCloud Insight product helps you understand and visualise your data. From databases to spreadsheets, drag and drop to create dashboards and see your data in real time – identify performance trends immediately (and we’ve built a dashboard to show you how you are performing against payment practice legislation as well).