Payment terms and early-payment discounts in Sage Intacct

How Sage Intacct handles terms

Payment terms are the standing instruction that decides when a supplier's bill falls due and whether paying before that date earns anything. In Sage Intacct, terms are held on the vendor record and can be changed on an individual bill when a supplier negotiates something different for a single purchase. Getting the term right at the point of entry is what makes every later step, from the payment run to the aging report, line up with what the supplier expects.

The term record carries the due date and, where the supplier offers one, an early-payment discount. In Sage Intacct, AP terms can carry an early-payment discount as a fixed amount or a percentage, with grace days. One restriction to know: discounts on terms are not available for entities with VAT or GST enabled, so if your entity has VAT or GST turned on, the discount side of the term record is not where the decision lives.

AP clerks should confirm the term on the vendor before keying the first bill from a new supplier. A term copied from a template or inherited from a similar vendor is one of the commonest reasons a discount is missed or a bill is paid weeks before anyone intended. Read the supplier's own wording, including how many days the discount window runs and whether any grace days apply, and set the term to match rather than to what the last vendor used.

Grace days matter more than they look. They extend the window past the stated discount date, so a bill that would otherwise sit just outside the cutoff can still qualify. When a supplier offers them, load them onto the term so the decision is made on the correct date rather than on a clerk's memory of a phone call.

Early-payment discounts

An early-payment discount is a reduction a supplier gives for paying ahead of the due date. It is a financing decision as much as an AP task: the supplier is effectively paying a rate for cash sooner. Compare the value of the discount with your own cost of funds. If borrowing or holding cash costs less than the discount is worth over the same period, taking it usually makes sense; if it costs more, paying on the due date preserves cash.

In Sage Intacct the term can express the discount either as a fixed amount or as a percentage, with grace days attached. A fixed amount suits a standing arrangement with a supplier where the same sum is offered each time. A percentage scales with the bill and is the more natural fit when order sizes vary. Pick the form that matches what the supplier actually offered and record it once, on the term, rather than re-deciding on every bill.

Discount discipline depends on the invoice date. If a bill arrives on a Monday and is keyed the following week, the discount window has already lost days, and a term set up correctly still produces a missed opportunity. Enter bills the day they arrive, check the discount date on the bill before approving it for payment, and flag any bill whose window closes before the next scheduled run so it can be pulled forward deliberately.

Where VAT or GST is enabled on the entity, discounts on terms are not available. In that case the discount decision has to be made and recorded outside the term, and the approver needs to see it on the bill so the deduction is taken only when it is genuinely owed. A discount taken in error becomes a short payment, and a short payment turns into a supplier statement query and a second payment later.

Mistakes to watch for

The most expensive term mistakes are quiet ones. A supplier invoice keyed as INV-1043 and later re-keyed as 1043 creates two bills that look unrelated to a busy clerk but identical to the payment run. The same supplier set up twice under slightly different names splits bills, credits and aging across two records, so a bill entered on one can be paid again on the other. Statements paid as though they were invoices, and payment runs re-sent after a file error, produce the same result: a second payment that looks legitimate in isolation.

Discount errors run the other way. A discount taken after the window and its grace days have closed is a short payment, and the supplier will chase the balance or net it against the next invoice. A discount skipped because nobody looked at the discount date is money left with the supplier. Both are avoidable if the term is right and the dates on the bill are questioned before approval instead of after the run.

Term changes are another trap. When a supplier renegotiates, the term on the vendor record is updated, but bills already in the system may still carry the old term. Pull open bills after any term change and confirm each one reflects the new arrangement. The same check applies when a vendor is set up fresh: confirm the term was loaded rather than left at whatever default the record started with.

A practical control is to require the bill number on every entry to match the supplier's invoice exactly, prefix included, and to make the clerk confirm the vendor record is the only one for that supplier. Those two habits, applied consistently, remove most of the conditions that produce duplicates and missed discounts.

Checking past payments

You cannot recover what you cannot see, and duplicates rarely announce themselves in the current month. Match on vendor, amount and date windows: the same vendor, the same amount, dates within a window wide enough to catch a bill re-entered weeks later. Include the bill number and the payment reference in the same comparison so a re-keyed invoice and a re-sent run both surface.

Reconcile supplier statements against your ledger, not the other way round. Items the supplier shows as outstanding can be invoices you never received, but they can also be payments you made that the supplier has not applied, or credits you have not taken. When you find an overpayment, ask the supplier for the credit back rather than leaving it to be netted against a future invoice where it will be easy to lose track of. Small suppliers often apply a credit only when someone asks.

In Sage Intacct, Accounts Payable reports include AP Ledger, Bills analysis, Bills register, Vendor aging and Vendor list. When you export bills from Sage Intacct, the Bill number column holds the supplier invoice number, so a sort or pivot on that column brings pairs such as INV-1043 and 1043 next to each other within seconds. Run the same comparison across two or three months rather than one, since duplicates often span a month end.

Work the findings in order of certainty. A confirmed duplicate payment is a refund request. An unapplied credit is a request that it be applied. A discount you were owed but did not take is worth a conversation with the supplier before the next order, and a discount you took in error needs correcting before it hardens into a disputed balance.

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