Payables Scheduled Payments

The Scheduled Payments function in Payables Management, allows you to create an amortization schedule for an existing payables invoice, calculate interest expense, and then post to GP so that you can recognize a liability for a non-AP amount, and only show the current payment due in the AP aging.

This functionality was developed for the scenario in which your vendor has agreed to accept a schedule of partial payments as opposed to payment-in-full. Some of our clients are also using this to record basic loans and leases, which then allows them to have all the accounting for such arrangements in GP.

This is simple to do:

Navigate to: Transactions >> Purchasing >> Scheduled Payments

Select the posted payables invoice you want to create a schedule for.

Complete the specific attributes of the arrangement, e.g. Interest Rate, Number of Payments, Frequency of Payments, etc. The functionality allows you to solve for Number of Payments or Payment Amount, if you wish.

Click on Calculate. You can calculate and re-calculate until you get the schedule that matches your arrangement.

Click on Amortization to view the calculated schedule.


Here's the meaning behind the accounts:

Accounts Payable posting account:
Debited with the scheduled payment amount, including principal and interest, when an individual payment is posted using the Post Payables Scheduled Payments window.
Credited with the total schedule amount, not including interest, when the payment schedule is posted using the Payables Scheduled Payments Entry window.

Payables Offset posting account:
Debited with the total schedule amount, not including interest, when the payment schedule is posted using the Payables Scheduled Payments Entry window.
Credited with the scheduled payment amount, not including interest, when an individual payment is posted using the Post Payables Scheduled Payments window.

Interest Expense posting account:
Debited when you post a payment schedule.
Credited with the interest portion of the scheduled payment amount when an individual payment is posted using the Post Payables Scheduled Payments window.

Once you're satisfied that you have the schedule correct, click on Post. This will back out the AP amount on the GL and move it to the liability account you specified.

Done with the first step.

Now as time passes you will want to post payments from the schedule, to the open accounts payable.

To do that, navigate to: Tools >> Routines >> Purchasing >> Post Scheduled Payments

Just mark the payments you want to move to payables, and post.

If you haven't tried this functionality out yet, you should. There's a good chance that it can manage some of your current payment obligations, and you can retire some old spreadsheets.

Similar functionality is also available in the Receivables Management module.