To not pay over due invoices I just received immediately?

@blacksax

No, no I did understand. We both should've specialised in insolvency, we'd be raking it in.

You're probably covered with this particular payment since you can prove when they invoiced you, but we haven't seen your contract.

More generally, why aren't your staff marking orders received so that management accounts can reflect the associated expenses and accruals? And given a rollocking everytime an invoice lands for a completed order without a correctly updated PO.

And if they had invoiced you on time, how were you paying it if you don't have the money?

You didn't think I meant I'd become insolvent myself, did you?!

I was talking about becoming one of the accountants who sort out the finances of companies who have gone into liquidation. They get paid first in line no matter what, and can earn up to £200-£300 an hour...

How can your forecast your cash flow if you don’t know what invoices are due and when?

And if your cash flow is so tightly managed then you absolutely should know the timings of large invoices.

The place I work now is small with massive cash reserves. I could get an invoice for £5m and pay without blinking but I’d still know about it and when it was expected.

OP is managing cash and this payment creates a problem. Any company who manages their cash this tightly should know when large invoices are on their way. The fact OP mentions the value and it causing a problem shows that it’s a significant cost for them.

Excuse me???

Every business will have a business to business contract (B2B) which you agree to.

I'm not putting anyone down. A lot of people clearly don't understand B2B contracts. No one is saying the money isn't owed, but if the B2B contract says payment after X days from invoice, then that's what happens.

Just because a company has been really late sending an invoice, doesn't mean they can just demand £200k immediately. The same procedure applies.

What a condescending little post. How cringe. Putting people down like that.

ours are payment based on goods issue date. Every company is different.

you can answer the question without attacking other posters.

I think that’s shitty, you knew what needed to be paid, simply schedule them for payment. Yes you can mess with them, but it is likely they are a supplier for a reason, so keep the relationship good, sometimes things go wrong. A good relationship you work together.

YANBU. Most pay say you're being unreasonable, but most won't have a clue how an invoicing system works. They're probably thinking along the lines of them owing someone £50 for a day out!

Every engineering company I have worked for has a "system". You raise a purchase order, get various people to sign it (which takes ages), the order gets put through, we get the tooling/materials or whatever we ordered, then once received and we're happy with it, the supplier sends the invoice and it goes through the "invoicing" system, gets matched to the purchase order and paid.

The business T&Cs usually say how many days from receipt of invoice that it actually gets paid. What is your agreed turn around on payment? You need to stick to whatever T&Cs were agreed in the contract with this company.

Companies can't just store £200,000 in a current account. It gets moved to an interest account, and hence the procedure in place.

If this company have only just sent the invoice and the T&Cs say you will pay invoices within X days, then just stick to what was agreed.

Of course you pay them now - they are overdue! It doesn't matter if you received the original invoices or not, you must have know an invoice would be coming at some stage. I used to pay accounts as part of my job and these would have been paid asap.

It also might be a good idea to put a policy in place for supplier payments which incorporates their company size, obviously 200k delayed to a small company can have catastrophic results whereas a massive corporation with forgiving cashflow might not mind a few days extra on their terms.

The way of managing invoices sounds totally normal to me, and the fact that finance don't know the exact timing for when every invoice will be paid also sounds totally normal.

In a decent sized business 6 figure invoices are not unusual or interesting, there are hundreds of them. I think some people aren't understanding that.

Yanbu

It's their mistake.

I think a reasonable supplier would apply the usual 30 day terms (or whatever period they are), for you to pay the invoices. Particularly at that value.

It's definitely worth emailing her head of department.

Make sure everyone is copied in, so you've covered your arse, because there are obviously payment time implications involved.

Aren't you the expert here?
This is literally your job to know how to handle this.

It doesn't even need an audit. Just good business sense would help.

This whole process needs an audit, once you have reports for all process stages and mismatches things should be better

@burnoutbabe I suppose I’m just saying that I’d be expecting it, and notice NOT having received it, and I’d ask ‘why haven’t we had the invoice’ to the PM as potentially they maybe some issue I don’t know about, or, as I’ve come to expect, it’s in his bloody inbox.

The way OP described her 6 week schedule made it seem like a catch-all for all projects without an invoice, not scheduled for week 6.

She said she wasn’t expecting it as she didn’t know the project was finished. This, to me, is the bit I just don’t get when it’s a £200k payment.

And I actually WOULD chase a supplier for an invoice that I knew was due in some circumstances. I don’t know if there’s been a glitch or miscommunication somewhere. Most of our suppliers have their relationship with the budget holder and therefore I wouldn’t want a delay to affect business relationships.

But how does one look out for the invoice?

Do you mean chase the supplier for it?

I have occasionally fallen foul of the "sent to the ceo" invoices but he is well trained now.

But really no one is chasing suppliers to send invoices to pay them. That seems odd unless it's something like "you must pay the bill for the servers every month without fail else they get turned off".

@burnoutbabe that’s not how I’d treat it. If I knew the project had completed I’d have it in 30 days from completion (or whatever terms are). If I hadn’t seen the invoice I’d ask the PM if it had gone directly to him but still be expecting it to be paid as due.

I appreciate that may be different from other companies but the key point for me is OP didn’t know the project status and if she had she’d have been on the lookout for the invoice.

Also, I’m used to budget holders who are utterly shit at passing on invoices so often the first I know of an invoice being overdue is when my clerk asks for an urgent payment for an invoice that’s been in someone’s inbox and not passed to us.

I'm staggered. How can no one else think that this is all ok? To even view it this way. Tell me it's not just me, please?

YABU! And if you work for a midsize company, you are taking this a bit too personally!

But it isn't out of the blue.

OP said she knew about the PO and it was in her week 6 cashflow horizon.

In OP's position, on receipt of the invoice, I would have just processed the invoice as normal and it would have moved into week 5 of the cashflow when the week rolled forward.

If treasury management allowed (or it was a particularly sensitive supply/supplier relationship), yes, I'd expediate payment but that wouldn't be automatic by any means.

Yes absolutely you would be communicating with the PM but even if communication had been perfect (as per your example), the invoices themselves weren't forthcoming from the supplier, so it wasn't unreasonable of her to keep them in "week 6" of her cashflow.
Because the the supplier might have taken 3 months to send an invoice and OP's company would be daft to keep £200k cash in the bank if it could have been earning more interest elsewhere.

It IS in the cash flow - but for week 5/6 as they have not sent an invoice in and the 30 days runs from that.

If they had invoiced earlier it would be in week 2/3 etc.

If they fail to invoice in the week, the payment just gets moved another week forward until it is invoiced and then it crystallises which week it falls into.

This is just how actual cash flows are done.
Which is different to one done annually for say budgets or the statutory cash flow (which is just a mechanical exercise between 2 balance sheet points)

If a supplier fails to invoice on time, then that's a temporary cashflow "bonus", I wouldn't expect Finance to be chasing up whether or not a supplier had bothered to invoice

I agree but chasing up an invoice and knowing one is due are different things.

Project X is finished. PM says ‘Goat - Project X is wrapped up and costs will be coming in from Suppliers A, B, & C’

They should be expected and allowed for. Yes, you obviously aren’t going to be on the phone asking for their invoice but when it arrives it shouldn’t be out of the blue.

If you have had the goods I can't see how you didn't schedule for it, you buy something you know you have to pay for it.

This is how small businesses struggle and go under, it’s the end of the month, salaries are due…pay what you owe fgs