Prompt Payment Act Requirements
- In accordance with the Prompt Payment Act (TEX GOVT Code 2251), interest due on late payments to vendors will be automatically calculated and included with the payments.
- Payments for goods and services must be paid no later than 30 days after the later of:
- receipt of goods/services, OR
- receipt of the invoice for the goods/services.
- Goods/services will be considered received when they have been accepted as usable by the end user.
- Invoices must be complete and delivered to the correct University office as specified to the vendor. The invoice must contain the Texas Identification Number (TIN). An invoice is NOT complete if it contains items that have NOT been delivered.
- Each invoice must be a separate transaction with a Payment Due Date when transmitted to the State.
- All funds held by The University are subject to the Prompt Payment Act.
- Payments must be scheduled to be paid as close to the 30-day limit as possible. Early payments may be made if a discount is available or if there is a contractual agreement to pay sooner.
- The late interest rate for the current fiscal year can be found in askUS
What Does This Mean?
- Additional data input fields are necessary on many payment vouchers. Some current fields will also become more important:
- Ending Receive Date (formerly Ending Service Date)--date that all goods/services were accepted by the end user (required field).
- Invoice Receive Date--date that the correct University office received the complete invoice (required field).
- Invoice Number (required field).
- Requested Payment Date--date for an early payment if it is necessary for a discount or a contractual obligation (optional field).
- Departments must establish procedures to document when invoices are received because the Invoice Received Date will be subject to audit review. An automated date stamp on the invoice is the preferred method.
- Only invoices with the same Payment Due Date may be paid on a single VP document.
- Payment documents MUST be in the Imaging and Documentation Services 5 working days for local funds and 7 working days for State funds, PRIOR to the Payment Due Date.
For answers to frequently asked questions about prompt payments, visit askUS.