[Indizine]

Can anyone see what advantage there is to raising an annual renewal invoice a little over 2 months before it is due? (other than you can hope that the money is in by the time it is actually due!)

Is this right and ethical? Is there some financial advantage? Does it cook the books somehow, besides looking to the board that your figures are 'up' just because you have accounts outstanding (supposedly) when in fact you dont?

[Chris(tina!)]

Could be down to trying to manage cashflow/cashflow issues? The annual subscription starts at the 'normal' time but, with luck, payment will be made earlier?

Oh, and for magazines I subscribe to, the letters always come far in advance of the payment - direct debit guarantee and all that, I've always assumed!

[Peter W]

It's unlikely to be to cook the books. The date on their bit of paper does not make that much difference - accounting is a little more sophisticated than that.

It is probably to give them enough time to deal with those people who lose the first copy, then take 30 days to approve the second copy, then need 30 days after that to pay...

[Indizine]

But if I was to renew and dont intend to pay until its due (and why the hell should I and why on earth would anyone else!) it would look like I am then a late payer!

[Peter W]

I see, they want paying well before the renewal date as well? Yes, that is a bit cheeky.

[Indizine]

ah yes, its not a July due date! Its dated 7th May and is on 30 days, but my subs dont expire until 15th July. They never used to do it before so I am thinking there is a reason for doing this. I wouldnt raise invoices that early even if I could - id have to pay the vat on them before I got paid in some cases pending what date they fell on.

[Peter W]

Going off at a tangent slightly, have you looked at accounting for VAT on payments rather than invoices?

[Indizine]

well I wouldnt normally need to, as I either take full payment, or half payment up front and remainder on completion before upload, pending on order size, but in considering a contract i'm doing at the moment it could be an option in the long term, so yes, I have thought about it.

[DavidT]

I also doubt anything to do with accounting, or figures and reports.

Possibly cash flow, and it does seem a bit much having them falling due more than a month before your current subscription.

My initial thoughts were that it was out of courtesy more than anything else. Personally I find it more rude to receive an invoice when a subscription has ended, particularly if it is a large amount and due for payment immediately.

Not sure where cash based VAT reporting comes into it. Did I miss something?

David Toohey
The Accountants Circle

[Peter W]

Originally Posted by DavidT

Not sure where cash based VAT reporting comes into it. Did I miss something?

Just picking up on Sandra's comment about potentially having to pay VAT before she got paid.