To not pay over due invoices I just received immediately?

Nope. Sorry. No accountant would think this way.

1)"There are POs yes but we in the accounts don't know if those orders will be fufilled. It is expected that once a supplier has done work they will invoice."

No. That's not the way it should be viewed. You are looking at it all wrong, I'm shocked. Your viewpoint should be proactive, you do know how many po's, what stage they are at, at m/e, whether the supplier invoices at 7 days, 30 days is irrelevant. How can the basic concept escape you?

2)"A statement could have avoided all of this. If the supplier sent one I would have been able to see that we had not received their invoices."

No. You are missing the whole point. It's frightening that you have even typed this. This isn't the way to view this. You should know. It's not up to them to supply the checklist. You should know yourself.

I find you frightening, your lack of insight, comprehension, your trying to blame others, goes all against all accounting principles.

No one will convince me that this is right. Sorry.

Accruing the invoices (or including it in a budget forecast) and paying the invoices are separate things.

It is possible for the OP to accrue the invoices and still not have them in her rolling 5 week cashflow. She said she had accrued them and also had them in her week 6 cashflow - ie, they were on her radar to be paid but just not to be paid within the 5 week horizon, as there wasn't an invoice.

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 - that's for their (supplier) credit controller to chase up (and if its a significant sum of money for them, they might even call pre-emptively to ask if it will be paid on the due date).

If a supplier was late in sending in an invoice, that's unfortunate (mainly for them) but they wouldn't automatically jump to the front of the payment list; they'd go in the rolling cashflow for payment as usual.

The OP said there is money in the account to pay the invoices but that would be at the expense of paying other suppliers who had managed to send an invoice in on time.
(Possibly that's why she originally said that there wasn't any money to pay the tardy supplier).

And no, you don't need the cash in the bank for every single PO. That's ridiculous; some POs might take months to complete or be delayed. Companies manage their working capital and cashflow so that they don't have to have large cash deposits on hand.

There are POs yes but we in the accounts don't know if those orders will be fufilled. It is expected that once a supplier has done work they will invoice.

But do you not understand that as an accountant in a business with tightly managed cash flow you SHOULD know. You should be having a monthly update with PMs or budget holders to get the status of the projects.

I’ve worked places where cash was managed so tightly that we updated the cash flow daily (urgh). I’ve also worked places where cash is so plentiful we could pay every single liability on our balance sheet without blinking.

You have to adapt to your business and in yours you need to be proactively across the projects so your forecasting is as accurate as possible.

Its perfectly reasonable not to pay an invoice immediately if payment terms are x days, but regardless of the invoice you should be aware of the project’s completion status.

You are absolutely an accountant - you are just not chartered or qualified but accountant isn’t protected.

I am also not fully qualified - life got in the way but I’ve consistently got jobs over more qualified candidates ’on paper’ because of experience and knowledge like you I doubt doubt.

@Merryoldgoat
Likewise. ❤️

Remember I'm not qualified though, (failed a paper years ago), which is why I never claim to be an accountant.

But I do know all audit rules, FRS's, system rules, enough, to be able question, eg some of the things on this thread.

Ah - my Mumsnet Accountant Bestie has arrived! I’m always glad when you show up 🥳

@blacksax
I'm with her! I should've gone into insolvency. "Very lucrative."

I've re-read. I agree with @Merryoldgoat, story keeps changing.

OP's story keeps changing. I can pick loads of holes in her posts, especially re engineers raising PO's :

"The engineers raise POs, often these things take months to materialise as it depends on the progress of the project. It has been forecasted but always put into week 6 as it has not yet been invoiced. Once it is invoiced it begins its track in the cash flow to being paid. "

And? So? All of this is traceable and trackable. Nothing should come as a surprise in accounts, ever, ideally.

Other people are making assumptions. Only later was it suggested that the invoices were 'backdated'. Which is a totally different book keeping concept. I don't think they were.

Or she later said statements hadn't been sent. Drip feed. Even if statements hadn't been sent, it is her job to know. She shouldn't even need statements. They are a control procedure, a checking mechanism.

And I'm laughing at posters telling op her mistake was asking non accounts people about it.

Oh tee hee.

Those invoices should have been accrued for, you must have been expecting them, whilst I don't make things like this a priority if they can't prove they haven't sent them on time, I wouldn't expect the full credit terms.

Usually POs have receipts done.
If the receipt was done and not invoiced you have a mismatch which you need a report for.

If the receipt was not done in a timely fashion, you have a mismatch which you need a report for and to talk to engineering about their relationship management when suppliers don't get paid!

I'm on the other end of this @WYorkshireRose and I totally agree with you. I don't expect to get paid the moment I submit an invoice, that's when the clock starts so it's 30 days after that (30 days being the standard for my industry).

If I don't get around to invoicing until a few weeks after I have completed/submitted the work, that's on me. The payment period is still the payment period.

Wouldn't be getting paid at the company I work at, day 1 is counted from the day we receive the invoice and we'll then pay on 30 days, 60 days, sometimes even 90 days depending on the arrangement with that particular supplier. If they're tardy with getting their invoice in then that's on them. Never yet had a supplier put us on stop, but it probably makes a difference that we're a large multinational and could just go elsewhere if they did.

I don't think we are the right people to ask. What's your normal company procedure?

It certainly is. We've had several of our customers go under in the last year, and there's one more that I suspect is about to go bust. Fortunately they don't owe us much.

All the bad debt paperwork from the liquidators lands on my desk, and it is quite an eye-opener to see just how much their fees are.

Depending on the contractual agreement- ie 30 days from invoice or payment after delivery or other you are required to make payment as per your agreed terms.

I have customers who try to delay making payments by saying they haven't received their invoices when in fact they have.

I have no issues placing them on credit hold preventing them from receiving any further deliveries from my company or calling upon a debt collector to recover money outwith the terms.

Regardless of the size of the company they are entitled to payment for services provided and may need that money to keep them afloat.

Since you lied here by saying you don't have the money then further down the post you say you do have the money, I'd question whether you actually did receive the invoice(s) originally and just buying time. Either way you'll only get away with that once per supplier

There is no law that says you give 30 days terms. Terms are subject to status and a credit check. There after 30 days is a default and not law. You do not have to give anyone 30 days to pay .

The procedure for winding up an insolvent company is a considerably lengthy and involved process, and in any case the OP's employer is not in the UK so different laws would apply.

If I'd known years ago what I know now, I might have gone into the insolvency practitioner line myself. Very lucrative.

Exactly, when I worked as a company accountant, I did my management accounts, forecasts etc on an accruals basis (as required by company law and accounting standards), so I provided for "ins and outs" as they happened, not on the dates the invoices were raised/received.

I left the "boring" bits of the ledger work, bill paying and customer payment chasing to my book-keepers and ledger clerks.

So I was always a few steps ahead of the actual money coming in and money going out, so we never had any nasty surprises.

To be honest, I didn't really pay much attention to the bank balance, monies in, monies out, etc., on a daily/weekly basis as I left that to the book-keepers and ledger clerks. My role as accountant was the "bigger picture" of ensuring and reporting on profitability and putting finance in place (additional overdraft facility, loans, asset financing, drawing out of deposit accounts etc) 2-3 months in advance of the money being required to be paid based upon purchase orders and delivery dates.

And most of us accountants would stick things accrued but not yet invoiced into our Cash flow at 4-6 weeks time. Ie assume we'll receive the invoice soon so it will be paid 30 days after that. (Unless other terms agreed)

No, OP said "[the invoices] are over due but I have never received them before" and that the supplier said they had already sent them at an earlier date, but when pressed to provide proof, could not do so.

I.e., the supplier forgot to send the invoice out on time (or there was an error in their system which meant it didn't get sent out, or was sent to the wrong person), but they are now bluffing, trying to act like they did send it out on time, to skip the normal payment term and be paid immediately.

I think you’re perfectly fine OP to stick to your payment terms if they made a mistake with sending out the invoice

(sadly learnt that one the hard way when I did exactly the same thing and didn’t send out an invoice and then chased them up for payment, although it wasn’t anywhere near 200k thankfully)

However from the other side, this does happen to us fairly recently when we receive invoices (again sadly not 200k) and depending on the amount we usually just pay it fairly quickly anyway as we do usually know what bills to expect. It does depend on how rude/nice the invoicer is though about it.

We have previously agreed to pay in installments, which is usually a happy medium for all.