About Prompt Payment Discounts

There are two different methods for offering Prompt Payment Discounts to customers in MYOB Exo Business:

automatically, based on the invoice date, the credit terms, and the prompt payment discount percentage entered for the Debtor, or
manually, based on your own discretion when receipting a payment, and the prompt payment percentage entered for the Debtor, regardless of invoice date.

Automatic Prompt Payment Discounts

This method uses the Prompt Payment Discount Calculation window to automatically calculate prompt payment discounts based on the due date of the invoice. Eligibility for the discount is based on the due date of each invoice, and uses the preset discount percentage on the Debtor account.

If you need to manage your outstanding discounts carefully in your business, this is the recommended method.

Automatic prompt payment discounts are managed by calculated by the Prompt Pay Discount Calculation utility; you can calculate new discounts, and review outstanding discounts.

Manual Prompt Payment Discounts

This method uses the PP Disc checkbox in the Debtor Receipts window to manually choose whether or not to give a prompt payment discount on a given invoice line. Selecting a line for prompt payment discount uses the discount percentage set up for the Debtor. No check is performed against the due date of the invoice - you can even give the discount to an overdue invoice.

If you need flexibility in the way you offer discounts on invoices, this is the recommended method.

When the discount is claimed, a credit note is issued for the discount amount, using the prompt payment discount stock item set up already in MYOB Exo Business.

Discounts manually applied in this way to an invoice will exclude that invoice from the automatic prompt payment discount method, which only calculates the discount based on unallocated invoices.

Prompt Payment Discount Stock Item

When prompt payment discounts are given, either manually or automatically, a credit note is issued to each Debtor using the prompt payment discount stock item (PPDISC).

Prompt Payment Discounts and End of Period

We recommend that the first step is to review the outstanding discounts from the previous month. This will ensure that existing data is not erased.

Ideally, the Prompt Payment Discount Calculation and the Statement printing for the month should be run back-to-back, after the month's invoicing and just before the End of Period.