SECTION OVERVIEW AND POLICIES

The purpose of this section is to provide guidance to agencies about important dates involved in the payment process as well as the payment terms available in the Statewide Financial System (SFS).

Basis Date

SECTION OVERVIEW AND POLICIES

This section provides guidance to agencies on how the Basis Date impacts the Schedule Due and Discount Due fields using information from the vendor record in the Statewide Financial System (SFS).

In the SFS, the Payment Terms Basis Date Type field (“Basis Date”) in the location tab on the vendor record indicates the date that will drive select other date fields, such as the Scheduled Due field and, where applicable, the Discount Due field. For example, if the vendor record specifies the Basis Date is the Invoice Received Date; then, the SFS calculates the number of days from the Invoice Received Date to populate the date in the Schedule Due field.

Default Basis Date

Effective April 1, 2018, the default Basis Date for vendors classified as “procurement suppliers” is the Invoice Received Date. For more information on Invoice Received Date, please refer to Section 5.F – Invoice Received Date of this Chapter.

For all other vendor classifications (e.g., recipients), the default Basis Date is the Invoice Date. Please refer to Chapter X, Section 4.A – Vendor Classifications for more information on vendor classifications.

Process and Transaction Preparation:

The Basis Date is managed by the Office of the State Comptroller’s Vendor Management Unit (VMU) through the vendor location. For more information on vendor location, please refer to Chapter X, Section 4.D – Location. Agencies requesting a change to the default Basis Date must contact the VMU at [email protected] with such request and reasons in support of that request.

For guidance on adjusting the date in the Scheduled Due field in the SFS, please refer to Section 5.F – Selecting the Appropriate Payment Terms of this Chapter.

Invoice Received Date

SECTION OVERVIEW AND POLICIES

This section provides guidance and information to agencies regarding the definition and calculation of the Invoice Received Date in the Statewide Financial System (SFS).

Pursuant to State Finance Law §179-e, a proper invoice is a written request for a contract payment submitted by a contractor setting forth the description, price, and quantity of goods, property, or services delivered or rendered, in such form and supported by such other substantiating documentation as the state agency or the Comptroller or state agency may reasonably require. Agencies should designate the payment office in writing in the contract and/or purchase order(s).

Also pursuant to State Finance Law §179-e, the “receipt of an invoice” means (a) the date a proper invoice is received in the designated payment office, or (b) the date on which the state agency receives the purchased goods, property, or services covered by the proper invoice, whichever is later, or (c) with regard to final payments on highway construction contracts, the date determined in accordance with the Highway Law §38 (7) (g). Agencies document the “receipt of an invoice” date in the Invoice Received Date field in SFS.

Please refer to Section 4.F – Proper Invoice of this Chapter for more information on this topic.

The Invoice Received Date field on the voucher is used in the calculation of the Scheduled Due Date and Discount Due Date for vendors classified as Procurement suppliers. As such, all agencies must provide an Invoice Received Date on the voucher for interest eligible payments to avoid miscalculations of prompt payment interest.

Please see Section 5.F – Selecting the Appropriate Payment Terms and Section 5.F – Basis Date of this Chapter, and Chapter X, Section 4.A – Vendor Classifications for additional guidance on these topics.

Process and Transaction Preparation:

Each agency must ensure the Invoice Received Date field on the voucher equals the date it received a proper invoice in its designated payment office, provided the agency designated a payment office. For invoices received where the agency did not designate the payment office, the Invoice Received Date is the date the agency initially receives the invoice. The section below defines how the Invoice Received Date field is populated in SFS.

Online Agencies

For invoices not submitted using the eInvoicing functionality of the SFS, agencies must populate the Invoice Received Date field on the voucher in the SFS using the date the agency received a proper invoice.

For invoices submitting using the eInvoicing functionality of the SFS, the Invoice Received Date field is populated automatically by the SFS and is equal to (a) the date the vendor submitted a proper invoice prior to 5:00 PM on business days, or (b) the next business day for proper invoices submitted on weekends, holidays, or after 5:00 PM on business days. Please refer to Section 4.E – Electronic Invoicing Process of this Chapter for more information about electronic invoicing.

Bulkload Agencies

Bulkload agencies have two options to provide an accurate Invoice Received Date value:

1. Submit the Invoice Received Date value on the bulkload file; or
2. If the Merchandise/Invoice Received (MIR) Date is equal to the Invoice Received Date, an agency may leave the Invoice Received Date field blank on the bulkload file. The SFS will populate the Invoice Received Date with the MIR date from the bulkload transaction for vendors classified as Procurement Suppliers. The SFS will not populate the Invoice Received Date field for vendors not classified as Procurement Suppliers.

Please see Section 5.F – Adjusting the MIR Date of this Chapter for additional guidance on the MIR date.

Adjusting the MIR Date

SECTION OVERVIEW AND POLICIES

This section provides guidance and information to agencies regarding:

• The definition and calculation of the Merchandise/Invoice Received Date (MIR), which is used to calculate the Net Due Date.
• How to adjust the MIR date.

Please see Section 5.I - Prompt Payment Interest of this Chapter for additional guidance regarding Prompt Payment Interest and the Net Due Date.

Background

The MIR Date is the date a proper invoice is actually received in the designated payment office, or the date the state agency receives the purchased goods, property, or services covered by the proper invoice, whichever is later. Please refer to Section 5.F – Invoice Received Date and Section 4.F – Proper Invoice of this Chapter for more information.

The required payment date is the date by which a contract payment must be made in order for the State not to become liable for interest. The required payment date is 30 calendar days (15 days for qualified small businesses), excluding legal holidays, or in the case of final payments on highway construction contracts 75 calendar days, excluding legal holidays, after the MIR date for the amount of the contract payment due except when the required payment date is extended as described in the Adjusting the MIR Date chart below.

Process and Transaction Preparation:

Online Agencies

Effective April 1, 2018, the MIR Adjustment Date field will be available and used in the calculation of the MIR Date field. The MIR Adjustment Date field populates with the Invoice Received Date. If the Invoice Received Date is not entered, the MIR Adjustment Date field will populate the current date. Online agencies must provide an Invoice Received Date for interest eligible payments to avoid miscalculations in the MIR date and prompt payment interest.

The Statewide Financial System (SFS) compares the MIR Adjustment Date field on the voucher to the Merchandise Received Date or Merchandise Inspection Date on the purchase order, where applicable, and populates the latest date in the MIR Date field. If there is no purchase order or receiving required then the MIR Date will be the MIR Adjustment Date.

There may be instances where the agency must adjust the MIR Date. These are discussed below in the section titled Adjusting the MIR Date. The agency should update the MIR Adjustment Date field to properly adjust the MIR Date.

Bulkload Agencies

Bulkload agencies must manually calculate the MIR date by determining the later of invoice or merchandise received dates. However, there may be instances where the agency must adjust the MIR date as described in Adjusting the MIR Date.

Adjusting the MIR Date

In certain instances, the MIR date will need to be adjusted. Online agencies should update the MIR Adjustment Date field to adjust the MIR Date field. Agencies must consider the following additional situations when establishing the MIR date:

IF	THEN THE MIR DATE IS
1. OSC determines that there is reasonable cause to believe that payment may not properly be due in whole or in part,	1. increased by the number of calendar days taken to resolve the matter.
2. an inspection period or audit is specifically required by statute or contract provision	2. increased by the lesser of (i) the number of days provided for the inspection or audit or (ii) the number of days actually used for the inspection or audit. Note: For online agencies, the MIR Date does not need to be adjusted if a receipt is entered into SFS with a Merchandise Inspection Date.
3. the applicable appropriation has yet to be enacted (passed and signed),	3. the effective date of the required appropriation. Examples: 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
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 goods/services have not been delivered/rendered in compliance with the terms or conditions of the contract,	5. increased by the number of calendar days between agency notification to the vendor of noncompliance with the contract and notification of resolution.
6. the goods/services delivered are defective, the invoice is defective, and/or there are suspected improprieties of any kind,	6. the date the corrected invoice or goods/services are received by the agency. Agencies are responsible for notifying vendors of such defects/improprieties within 15 calendar days (7 for qualified small businesses) of receiving the invoice. If vendors are not notified within these timeframes, the 'increased MIR Date' is reduced by the number of calendar days in excess of 15 (7 for qualified small businesses) 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).
7. for final payments on highway construction contracts, the Commissioner of Transportation determines the vendor failed to properly submit the necessary documents and other submissions prescribed by law or contract	7. increased by the number of calendar days between the date the Commissioner of Transportation sends written notice to the vendor and the date that the agency receives the necessary documents and submissions.
8. legislation or a contract provides that payment will be paid on a predetermined date without having to submit an invoice,	8. the predetermined date less 30 calendar days.
9. the payment is not eligible for interest and is not initiated by an invoice,	9. 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.

Please refer to SFL §179-f and Title 2, Chapter I, Part 18 of the New York Codes, Rules and Regulations for more information.

Selecting the Appropriate Payment Terms

SECTION OVERVIEW AND POLICIES

This section provides guidance to agencies about selecting the appropriate payment term to ensure payments for goods and services are made at the most advantageous time for the State.

In the Statewide Financial System (SFS), the date indicated in the Basis Date Type field works in conjunction with the Pay Terms field on the voucher to calculate and auto-populate the date in the Scheduled Due field and, where applicable, the Discount Due field. The following information is represented in each of these fields, respectively:

• Basis Date Type – Used to calculate the Scheduled Due date and Discount Due date, where applicable. The default Basis Date Type for vendors classified as “procurement suppliers” in SFS is the Invoice Received Date. For more information, please refer to Section 5.F – Basis Date of this Chapter.
• Pay Terms – Establishes when the payment is due to the vendor and any discount term available under the agreement with the vendor.

• Scheduled Due – The date the voucher is scheduled to pay. The Basis Date Type and Pay Terms fields work in conjunction to calculate the Scheduled Due date. For example, for a vendor classified as a procurement supplier in the SFS, a voucher with an Invoice Received Date of April 1 and a payment term of Net30 will have a Scheduled Due date of April 30.

• Discount Due – The date by which the payment must be made to take advantage of the discount. The Discount Due date is calculated based on the Basis Date Type and Pay Terms. For example, a voucher with an Invoice Received Date of June 1 and a Pay Term of .5/15 Net30 will have a date in the Discount Due field of June 15. Agencies should ensure staff are aware of cash discounts offered by vendors and should ensure staff complete invoice verification/approval processes in time to obtain the discounts.

Regardless of when a voucher is entered into the SFS, the system will automatically determine the payment date most advantageous for the State based on the Pay Term and the Basis Date Type. Vouchers approved by the Office of the State Comptroller after the early payment discount period will not pay until the Net Due Date (i.e., 30 days after the invoice received date, for most purchases.)

Changing PayTerms

The table below summarizes how Pay Terms default and can be changed in the SFS.

SFS Record	Pay Term Default	Pay Term Change
Vendor Location	The Pay Term on the vendor location will default to Net30.	Vendors can change the default Pay Term of Net30 on their location.
Contract	The Pay Term on a contract will default based on the vendor location.	Agencies can change the Pay Term by updating it on the contract.
Purchase Order	The Pay Term on the purchase order will default based on the contract, or where there is no contract, will default based on the vendor location.	Agencies can change the Pay Term by updating it on the purchase order.
Voucher	The Pay Term on the voucher will default from the purchase order, contract, or vendor location (in that order).	Agencies can change the Pay Term by recording it on the voucher.

Agencies should only change the default Pay Terms if the vendor offers a term that is more beneficial to the State. For example, a vendor establishes a Pay Term of 2/10, Net 30 on their location but offers the agency a Pay Term of 3/15, Net30 on a specific contract. The agency should change the Pay Term on the contract to 3/15, Net30 because it will receive a greater discount. Also, if the same vendor offers a one-time Pay Term of 5/10, Net 30 on a single invoice for end-of-year cash flow purposes, the agency should change the voucher to the 5/10, Net 30 Pay Term.

Agencies should not update the Pay Term to “Due Now” because it negates discount terms. However, agencies are permitted to use the term “Due Now” for the following types of payments:

• Benefit payments
• Interagency bills
• Vouchers paying a refund (i.e., vouchers with vendor IDs beginning with 02)
• Credit Memo Adjustment Vouchers
• Land purchases

Additionally, agencies MUST use the Due Now Pay Term on adjustment vouchers that are Refunds of Appropriation (ROA). Use of any other Pay Term will result in a delay in posting the returned payment. For full guidance on processing ROA adjustment vouchers, see Chapter VII.3.A – AP Adjustment Voucher Preparation.

Process and Transaction Preparation:

Agencies must ensure the Pay Terms on the voucher are appropriate based on the following:

• The vendor must have agreed to the Pay Terms either by updating their vendor location in the SFS or in writing on a contract, on an invoice, or in an email.

• The Pay Terms should reflect cash discounts offered by the vendor where applicable.

The table below indicates the Pay Terms available in the SFS. If the vendor offers multiple Pay Terms on a single payment, agencies should select the appropriate Pay Term based on the date the agency anticipates the payment will be made.

Agencies should contact the SFS Help Desk at [email protected] to request a new Pay Term be added to the SFS. Pay terms are generally based on a 30 day payment period, however for payments to qualified small business vendors, the SFS will automatically map the existing Pay Terms to 15 days. Agencies should not override these terms.

Payment Terms ID	Pay Term from Payments Tab Drop Down Box	Pay Term Description
.0130	.01/30 Net30	0.01% Disc in 30 days, Net 30
.0315	.03/15 Net30	0.03% Disc in 15 days, Net 30
.1D15	.1/15 Net30	0.1% Disc in 15 days, Net 30
.2515	.25/15 Net30	0.25% Disc in 15 days, Net 30
.2520	.25/20 Net30	0.25% Disc in 20 days, Net 30
.2530	.25/30 Net30	0.25% Disc in 30 days, Net 30
.5D10	.5/10 Net30	0.5% Disc in 10 days, Net 30
.5D20	.5/20 Net30	0.5% Disc in 20 days, Net 30
.5D30	.5/30 Net30	0.5% Disc in 30 days, Net 30
.6530	.65/30, Net30	0.65% Disc in 30 days, Net 30
.7515	.75/15 Net30	0.75% Disc in 15 days, Net 30
0.515	.5/15 Net30	0.5% Disc in 15 days, Net 30
00	Due Now	Due immediately
IMMED	Due Immed**	Due immediately
1.510	1.5/10 Net30	1.5% Disc in 10 days, Net 30
1.515	1.5/15 Net30	1.5% Disc in 15 days, Net 30
1.530	1.5/30 Net30	1.5% Disc in 30 days, Net 30
10D15	10/15 Net30	10% Disc in 15 days, Net 30
10N	10N	10th day of next month
11030	1/10 Net30	1% Disc in 10 days, Net 30
123EM	30/60/90EM	30/60/90 days end of month 1/3
123M	30/60/90	30/60/90 days 1/3
12SP	12 x Split	12 x Split Due EOM/EOM+1
17530	1.75/30 Net30	1.75/30 Net30
1D15	1/15 Net30	1% Disc in 15 days, Net 30
1D20	1/20 Net30	1% Disc in 20 days, Net 30
1D30	1/30 Net30	1% Disc in 30 days, Net 30
1D5	1/5 Net30	1% Disc in 5 days, Net 30
1N	1N	1st Day of Next Month
2.515	2.5/15 Net30	2.5% Disc in 15 days, Net 30
2.530	2.5/30 Net30	2.5% Disc in 30 days, Net 30
27515	2.75/15 Net30	2.75% Disc in 15 days, Net 30
2D	2/10 Net30	2% Disc in 10 days, Net 30
2D15	2/15 Net30	2% Disc in 15 days, Net 30
2D20	2/20 Net30	2% Disc in 20 days, Net 30
2D30	2/30 Net30	2% Disc in 30 days, Net 30
20	20 (For Utility Payments Only)	Payment 20 Days, Net 30
30	Net30 *	Net 30
31530	3/15 Net30	3% Disc in 15 days, Net 30
3D20	3/20 Net30	3% Disc in 20 days, Net 30
3D30	3/30 Net30	3% Disc in 30 days, Net 30
3X433	40-30-30%	3 x Net30, 40-30-30% split
4D15	4/15 Net30	4% Disc in 15 days, Net 30
5D15	5/15 Net30	5% Disc in 15 days, Net 30
5D20	5/20 Net30	5% Disc in 20 days, Net 30
5D30	5/30 Net30	5% Disc in 30 days, Net 30
7N	7N	7th day of next month
EM	EOM	Due at the end of this month
EM1	End Nxt Mt	End of next month
NXTM	Next Month	Next month
REB2%	REB2%	Maximum rebate percent 2%
REB5%	REB5%	Maximum rebate percent 5%
SP	Split	1-15 due EOM, 16-31 due EOM+1

* The SFS default Pay Term
** This Pay Term is reserved for payments where an agency receives discounts based on timeliness of payment and volume purchased. The use of this Pay Term requires prior OSC approval. Agencies should contact [email protected] to request approval.

Online Agencies

Contract Payments

Agencies should establish Pay Terms on the contract in the SFS based on the Pay Terms agreed to in the contract. Agencies can use the PO Defaults page on the contract to update the Pay Terms ID field. A purchase order that is released from or associated with the contract will inherit the contract Pay Terms. A voucher that references the purchase order will inherit the Pay Terms from the purchase order.

Non-Contract Payments

Like contract payments, a voucher that references a purchase order will inherit the Pay Term from the purchase order. If no purchase order is associated to the voucher, the Pay Terms field on the voucher will default based on the vendor’s location. For more information on vendor location, please refer to Section 5.D - Selecting the Appropriate Payment Location of this Chapter. Where the vendor has not indicated a Pay Term on their record, the system default is set to Net 30 (15 days for qualified small business). This means the payment will be made on the later of the date OSC approves the voucher or the Scheduled Due date.

Bulkload Agencies

Bulkload agencies should submit vouchers to the SFS using the gross amount of the invoice, along with the Invoice Received Date and Pay Terms to enable the SFS to calculate the Scheduled Due date and Discount Due date, where applicable.

All Agencies

Adjusting the System Calculated Scheduled Due Date

Agencies should only override the system-calculated Scheduled Due Date on an exception basis. It may be necessary to override the calculated Scheduled Due Date in special circumstances such as lapsing, fiscal year-end and emergency payments. Agencies should adjust the Scheduled Due date to the date they want the voucher to process for payment, after OSC approval. However, when adjusting the Scheduled Due date, agencies need to consider the following or your voucher may not pay when expected:

• It generally takes 3 days from the time the agency submits a voucher to OSC for approval and payment.
• If a voucher has a discount Pay Term and is not approved by OSC by the Scheduled Due date, the voucher will pay on the Net Due Date.).
• A voucher with a Pay Term that does not yield a discount (e.g., Net30) will pay immediately if it is approved by OSC after the Scheduled Due date.
• If the Scheduled Due date on a voucher is adjusted to a date after the Discount Due date, the voucher will not take a discount under any circumstances.

For additional instruction on this topic, visit the job aids published to SFS Coach. SFS Coach is accessible from the SFS home page after logging in with your SFS user ID and password. And the guidance outlined in Chapter XVII, Section 3 – Lapsing Transaction Deadlines and Section 6.E – Making an Emergency Payment of this Chapter for more information.

For more information on Net Due Date, please refer to Section 5.I – Prompt Payment Interest Calculations of this Chapter.

For assistance with adjusting the Scheduled Due date, please contact the Bureau of State Expenditures’ Customer Service Help Desk at (518) 474-4868, or by email at [email protected].

Guide to Financial Operations

REV. 09/01/2021