Run Prompt Payment Interest Calculation (30.3.6)
  • 02 Apr 2024
  • 8 Minutes to read
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Run Prompt Payment Interest Calculation (30.3.6)

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Article summary

Business Process Overview

The Run Prompt Payment Interest Calculation process outlines the process of calculating and managing Prompt Payment Interest in a financial system. It starts with the recording of important dates on vouchers for reporting and interest calculation. Interest vouchers are generated based on specified criteria, and the Agency AP Processor reviews them along with the Prompt Pay Compliance Report to verify interest. Incorrect interest vouchers may be deleted or updated, and the Basis Date can be recalculated when necessary. Approved interest vouchers pass the Budget Check and are posted, generating accounting entries. An outbound file containing voucher information is available for various systems. Budget exceptions are managed according to agency policy, and the process also involves the generation of general ledger journals.

Business Process Diagram

Business Process Diagram for 30.3.6 Prompt Payment Interest Calculation

Business Roles

The Business Process Flow Diagrams use horizontal swim lanes to depict where activities are performed by different parties or systems. Each swim lane is titled with a role, either agency-based or within DFS, and in some cases, are representative of an external entity or system. The swim lanes may change from page to page within a single business subprocess as more or fewer roles are required to execute sections of the business subprocess.

  • Agency AP Processor: agency role responsible for entering invoices, voucher corrections and issuing and maintaining disbursements in Florida PALM 
  • DFS AP Maintainer: DFS role responsible for deleting or updating Prompt Payment Interest Vouchers

Business Process Flows Details

The tables below describe steps in each business subprocess as reflected on the Business Process Flow Diagrams. The tables also reflect information associated with each step describing the intent of the specific process. Florida PALM screenshots are included within the sections to allow connections to be made from specific business subprocess steps to screens within Florida PALM. This information should be read in conjunction with the Business Process Flow Diagrams.

Process Step ID

Process Step Title

Description of Process

1

Run Prompt Payment Calculation

A Voucher is created in Florida PALM and the date the invoice was received, the date the goods and services were received, and the date the goods and services were approved is recorded on the voucher. These dates are required on the voucher for reporting prompt payment compliance and calculating interest due to suppliers, when applicable.


2

Generate Interest Vouchers

Once the Payment Creation Process is complete the system will use the later of the three dates as the Basis Date. The Basis Date is used to automatically calculate Prompt Payment interest due. An interest voucher is generated if interest is due.


Based on 215.422 F.S interest accrues after 35 days for any non-paid invoices for health-related services and 40 days for all other invoices. Florida PALM uses the Account ChartField values to determine if a voucher is health related.


3

Review interest Vouchers

The Agency AP Processor reviews the Interest Voucher and the Prompt Pay Compliance Report to verify interest is due. Occasionally dates have been entered incorrectly and the interest calculation is incorrect.


4

Delete Interest Voucher

Interest vouchers that are incorrect may be deleted by the DFS AP Maintainer. The Agency AP Processor may request the DFS auditing team to delete the interest voucher. The Agency AP Processor may be asked to provide supporting documentation to the DFS auditing team.


5

Update Interest Voucher Line Distribution

Interest vouchers that require a change in the Distribution Line may be updated by the Agency AP Processor. The Agency AP Processor may not delete the voucher or update an incorrect date. The Agency AP Processor may request the DFS AP Maintainer to delete the voucher and to correct a date.


6

Recalculate Basis Date

If a date was added incorrectly and the Basis date should be re-calculated the Agency AP Processor may request the DFS AP Maintainer to delete the interest voucher and update the incorrect date on the initial voucher. Once the date is corrected the system will re-calculate the Basis date and create a new interest voucher.


7

Approve Interest Vouchers

The Agency AP Processor approves interest vouchers that are due to the supplier.


8

Run Budget Check

Budget Check runs and validates the current budget for each voucher against ChartField values entered in the expenditure distribution. If the interest voucher passes budget check the voucher is posted.


9

Post Interest Vouchers

The Post Voucher step indicates that the interest voucher completed the required steps and is approved for payment.


When the voucher is posted, an accounting entry is generated to recognize an account payable (i.e., a liability) to the supplier, and to recognize the associated expense/expenditure accrual.


10

Outbound Voucher and Payment Extract File
(API031)

An Outbound interface flat file containing voucher accounting, voucher status and payment information is available for agency business systems, source systems, and transparency sites.


11

Manage Budget Exceptions

Internal agency policy should guide the Agency AP Processor regarding transaction processing when a budget error is returned. Depending on your agency policy the Agency AP Processor can update the ChartField string or contact the Agency KK Budget Maintainers.


Please see 20.2 Budget Execution and Management for more information.


Transactions that fail budget check do not consume appropriations. Budget check exceptions continue to be systematically checked until they are resolved. Budget Check is re-run after updates have been made to the voucher.


12

Generate GL Journals

Journal Generator (JGEN) processes posted accounting entry data from the Florida PALM source modules, summarizes the data, and creates journals in the General Ledger. The Journal Generator process will edit check, budget check, and post the journal entries created during the process. Please see 10.2 Enter and Process Journals for more information on source module journal entries.

Accounting Events

Accounting events originate during transaction processing in the applicable source module. The accounting events impact the source module, Commitment Control ledgers, and the General ledger (Actuals).

  • Source Module accounting entries require user input (I) of the primary line (i.e., expenditure, revenues) with an automated (A) system offsetting line (i.e., payable, receivable) during transaction entry. The source model transaction must pass Edit Check, Budget Check, and Cash Check (on applicable entries) prior to posting the transaction.
  • The Run Budget Check (Commitment Control) process automatically affects balances in the appropriate budget ledger (i.e., appropriation, spendable cash) if the transaction passes the budget check process.
  • After the transaction is posted in the source module, an automated system process summarizes and posts the entries in the General Ledger module to the Actuals Ledger.

The table below provides the most common accounting events applicable to this business process.

Acct Event ID 

Accounting Event

Commitment Control Ledger(s) Impact

Source Module Accounting Entry

General Ledger (Actuals) Entry

KK01

Encumbered Voucher Budget Check
No Entry
Liquidates encumbrance by the amount of the Voucher andincreases expense balance.
No Entry
KK02
Unencumbered Voucher Budget Check
No Entry
Reduces Available Appropriations, Allotments, and Release Balances, and increases expense balance.
No Entry
AP01
Encumbered Voucher Post
Debit: Expenditures (U)
Credit: Accounts Payable (S)
No Entry
Debit: Expenditures
Credit: Accounts Payable

Reports

Key Reports are displayed as icons with the Report Number on the Business Process Flow Diagrams. The table below provides the reports identified to be produced at a particular process step or is used to support the completion of a process step.

Report Number

Report RICEFW ID

Report Description

Report Source

Report Frequency

Audience

R2

APR001

Prompt Payment Compliance Report – a report that measures the time elapsed between receipt of invoice, receipt of goods and services, approval of goods and services, and payment date by Business Unit

PeopleSoft

Daily, Monthly

Agency, DFS

Note: A complete list of reports may be found in the Reports Catalog.

Conversions

The table below identifies the Conversions related to this Business Process. These items are not included within the Business Flow Diagrams; however, these items are important elements of each Business Process.

Conversion Number

Conversion Description

Source

N/A



Note: A complete list of conversions may be found in the Conversions Catalog.

Interfaces

The table below provides the Interface IDs for each interface identified on the Business Process Flow Diagrams.

Interface Number

Interface Description

Interface Frequency

Source

Target

API031

Outbound Voucher and Payment Extract – Outbound interface containing voucher accounting, voucher status and payment information to source systems, transparency sites and Vendor History

Daily

Florida PALM

Agency Business Systems, MFMP, STMS, Works

Note: A complete list of interfaces may be found in the Interface Catalog.

Forms

The table below provides the Form Numbers for any forms identified on the Business Process Flow Diagrams.

Form Number

Form Description

Audience

N/A



Workflows

The table below provides the Workflow Numbers for any workflows identified on the Business Process Flow Diagrams.

Workflow Number

Workflow Description

Audience

N/A



Agency Configurations

The table below identifies the Agency Configurations related to this Business Process. These items are not included within the Business Flow Diagrams; however, these items are important elements of each Business Process.

Configuration Number

Configuration Description

Configuration Maintainer

N/A



Version History

DateRevision Description
12/01/2023Original Version
03/18/2024Updated KK01 and KK02 accounting events.
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