9 Invoicing and Payment Procedures

Size: px

Start display at page:

Download "9 Invoicing and Payment Procedures"

Kathlyn Hutchinson
6 years ago
Views:

1 9 1 January 2000

2 This document is copyright of EURESCOM and may not be reproduced or copied without permission. EURESCOM does not warrant that the information contained in this document is capable of use, or that the use of the information is free from risk, and accepts no liability for loss or damage suffered by any person using this information Contacts For general queries: EURESCOM Mrs Karin Becker Schloss-Wolfsbrunnenweg 35 D Heidelberg, Germany Telephone: Fax: becker@eurescom.de For queries on the technical content of this Booklet: EURESCOM Mr. Lutz-Harald Richter Schloss-Wolfsbrunnenweg 35 D Heidelberg, Germany Telephone: Fax: richter@eurescom.de

3 TABLE OF CONTENTS TABLE OF CONTENTS...I 1 INTRODUCTION DEFINITION OF ANNUAL BUDGETS INVOICING BY THE INSTITUTE FOR PREPAYMENT MEASURES IN CASE OF LATE PAYMENT INVOICING BY SHAREHOLDERS FOR PROJECT COSTS PAYMENTS OF PROJECT COSTS TO SHAREHOLDERS CASH MANAGEMENT AT THE INSTITUTE...7 APPENDIX 1: PROJECT COSTS 1ST QUARTER 1999 ACCORDING TO CLASS OF CONTRIBUTION 1999 (EXAMPLE)...8 APPENDIX 2: OPERATIONAL COSTS 2ND QUARTER 1999 ACCORDING TO CLASS OF CONTRIBUTION 1999 (EXAMPLE)...9 APPENDIX 3: INVOICING AND PAYMENT CALENDAR FOR PROJECT COSTS (PC)...10 APPENDIX 4: INVOICING AND PAYMENT CALENDAR FOR OPERATIONAL COSTS (OC) EURESCOM Revision 1 January 2000 page i (i)

4 1 INTRODUCTION This Booklet introduces the Project and Operational Accounting process implemented within EURESCOM. The objectives of the Project and Operational Accounting process are to: invoice correct and in time pre-payments from the Shareholders make correct payments to Shareholders on the Project accounts prepare the Operational Budget, keep the operational expenditures under control, provide the EURESCOM Management and the Shareholders with the information they need or request minimize the amount of money staying in the bank accounts The archiving of documents related to all structural processes is described in Document 2.14 of the Institute Manual. The EURESCOM rules for invoicing and payment are contained in the EURESCOM Legal Documents, Section 4.2 (). This Booklet of the Management Handbook provides more detailed information. The intended readers of this Booklet are: people inside the Shareholders, who are dealing with accounting, invoicing and payments related to EURESCOM activities the EURESCOM Permanent Staff (EPS) members, especially Project Supervisors and accounting people EURESCOM Revision 1 January 2000 page 1 (11)

5 2 DEFINITION OF ANNUAL BUDGETS The Institute drafts on an annual basis a budget for both Project and Operational Costs and submits them, after approval by the Board of Governors, to the General Assembly (GA). After approval by the GA, the annual budgets are binding for EURESCOM Shareholders and for the Institute. Based on the annual budgets, the amounts for quarterly prepayments by the Shareholders will be calculated by EURESCOM. These amounts will be invoiced by EURESCOM and paid by the Shareholders following the procedures described in section 3 below. All prepayments are advances from the Shareholders to EURESCOM to provide the necessary liquidity for EURESCOM to fulfil its contractual obligations. The contractual payments to EURESCOM based on the real costs are fixed with the annual accounts and any difference between the prepayments and the contractual payments will be settled with the following prepayments EURESCOM Revision 1 January 2000 page 2 (11)

6 3 INVOICING BY THE INSTITUTE FOR PREPAYMENT The two approved annual budgets - one for Project Costs and the other for Operational Costs - are divided into four equal quarterly amounts for prepayment. The calculation of these amounts is based on one quarter of the annual budget, but has to take into consideration the foreseeable actual needs for the respective quarter. The amount of each quarter is broken down into the amounts to be paid by each Shareholder according to its class of contribution. Examples of these calculations are attached hereto as Appendix 1 (Project Costs) and Appendix 2 (Operational Costs). For legal reasons, invoicing and payments for Project Costs and Operational Costs must always be kept separate. The following procedures apply (see also Appendices 3 and 4 that provide a graphical visualisation of deadlines). Invoicing for Project Costs: EURESCOM invoices Shareholders for prepayments quarterly. The deadline for invoicing is 6 weeks before the end of each quarter. The deadline for Shareholders payments is the last day of the same quarter of the invoice. Shareholders shall transfer payments to the Institute to the following Bank account: EURESCOM account (EUR) for Project Costs: Deutsche Bank Heidelberg Bank Code Account No SWIFT#DEUTDE SM 672 Three weeks before the payment deadline EURESCOM sends an updated Quarterly Project Invoice Status to the Shareholders for information. Invoicing for Operational Costs: EURESCOM invoices Shareholders for prepayments quarterly. The deadline for invoicing 2 nd - 4 th quarter is 6 weeks before the beginning of the quarterly period concerned. The deadline for Shareholders payments is the last day of the same quarter of the invoice. Prepayments for the 1 st quarter will be invoiced late December/early January after the General Assembly (usually in December) has approved the budget. Payments are due 15 February. Shareholders shall transfer payments to the Institute to the following Bank account: EURESCOM account (EUR) for Operational Costs: Deutsche Bank Heidelberg Bank Code Account No SWIFT#DEUTDE SM 672 Three weeks before the payment deadline EURESCOM sends an updated statement of prepayments to the Shareholders for information EURESCOM Revision 1 January 2000 page 3 (11)

7 4 MEASURES IN CASE OF LATE PAYMENT In the case of a Shareholder not having paid the quarterly invoice by the 5th working day after the set deadline (i. e. the date of payment to EURESCOM s bank account), it will be charged interest at a rate of the prevailing discount rate of the German Federal Reserve Bank plus 4% (four percent). The charge is due for each and every month commenced. In the case of a Shareholder not having paid all its due contributions for two months, payment of its invoices to EURESCOM for Project Costs may be withheld EURESCOM Revision 1 January 2000 page 4 (11)

8 5 INVOICING BY SHAREHOLDERS FOR PROJECT COSTS Shareholders shall invoice Project Costs to the Institute on a quarterly basis, after the end of the quarter concerned. The forms given in Annex 5 of Booklet #10, The EURESCOM Contracts of the Management Handbook, filled in according to the procedures described in the same Booklet #10, shall be annexed to the invoice. When a Project is technically completed, EURESCOM shall inform all Contractors. A letter will be sent that shall set a deadline for the final invoicing of Project Costs to the Institute. This deadline is six months after the Project completion date (see Booklet #6, How to close EURESCOM Projects of the Management Handbook). The next Monthly Report of the Institute shall also include this information EURESCOM Revision 1 January 2000 page 5 (11)

9 6 PAYMENTS OF PROJECT COSTS TO SHAREHOLDERS All Shareholders invoices received by EURESCOM are given a stamp carrying the date of receipt. The EPS performs the following checks: accounting checks: original invoice correct calculation WS Form Form attached budget available according to the latest CA Form issued by the Project technical checks: the work invoiced was carried out the results are acceptable. The Institute shall pay all accepted costs not later than 30 days after the receipt date of the invoice. For effective cash management (see section 7), payments for Project Costs are made three times a month (about every ten days). To reduce transfer fees to the bank institutes, all invoices received from a Shareholder that are totally accepted and have the same deadline for payment are paid by EURESCOM in one transaction. Invoices not totally acceptable, which are paid only in part, are dealt with separately EURESCOM Revision 1 January 2000 page 6 (11)

10 7 CASH MANAGEMENT AT THE INSTITUTE The money held in EURESCOM s current bank accounts should be kept to a minimum, and an effective cash management shall be used to obtain best interest rates. The situation at the end of each month is visible in the monthly Short Term Income Statement (Annex 3 of the Monthly Report). Following a decision of the GA, the interests on deposits in EURESCOM bank accounts are paid into the bank account for Operational Costs EURESCOM Revision 1 January 2000 page 7 (11)

11 APPENDIX 1: PROJECT COSTS 1ST QUARTER 1999 ACCORDING TO CLASS OF CONTRIBUTION 1999 (EXAMPLE) Class 1999 Project Costs EUR SH 1 EPT Luxembourg 0, SH 3 Iceland Telecom Ltd. 0, SH 4 Finnet Group 0, SH 5 Portugal Telecom SA 1, SH 7 Sonera Ltd. 0, SH 9 Yugoslav PTT 0, SH 10 OTE Greece 1, SH 11 eircom 1, SH 12 Telenor AS 1, SH 13 Belgacom SA 2, SH 14 Tele Danmark AS 2, SH 15 Telekom Austria AG 2, SH 16 Swisscom AG 4, SH 17 Telia AB 4, SH 18 Koninklijke KPN N.V. 6, SH 19 Telefónica I+D 6, SH 20 TELECOM ITALIA S.p.a. 12, SH 21 BT 12, SH 22 Deutsche Telekom AG 16, SH 23 France Télécom 16, SH 24 MATÁV HTC Ltd. 0, SH 25 Slovak Telecom, s.e. 0, SH 26 SPT TELECOM a.s. 0, SH 27 CYTA 0, Total 89, Project Budget 1999 = EUR which results in quarterly payment of EUR 2000 EURESCOM Revision 1 January 2000 page 8 (11)

12 APPENDIX 2: OPERATIONAL COSTS 2ND QUARTER 1999 ACCORDING TO CLASS OF CONTRIBUTION 1999 (EXAMPLE) Class 1999 Operational Costs EUR SH 1 EPT Luxembourg 0, SH 3 Iceland Telecom Ltd. 0, SH 4 Finnet Group 0, SH 5 Portugal Telecom SA 1, SH 7 Sonera Ltd. 0, SH 9 Yugoslav PTT 0, SH 10 OTE Greece 1, SH 11 eircom 1, SH 12 Telenor AS 1, SH 13 Belgacom SA 2, SH 14 Tele Danmark AS 2, SH 15 Telekom Austria AG 2, SH 16 Swisscom AG 4, SH 17 Telia AB 4, SH 18 Koninklijke KPN N.V. 6, SH 19 Telefónica I+D 6, SH 20 TELECOM ITALIA S.p.a. 12, SH 21 BT 12, SH 22 Deutsche Telekom AG 16, SH 23 France Télécom 16, SH 24 MATÁV HTC Ltd. 0, SH 25 Slovak Telecom, s.e. 0, SH 26 SPT TELECOM a.s. 0, SH 27 CYTA 0, Total 89, Operational Budget 1999 = EUR which results in quarterly payment of EUR 2000 EURESCOM Revision 1 January 2000 page 9 (11)

13 APPENDIX 3: INVOICING AND PAYMENT CALENDAR FOR PROJECT COSTS (PC) Deadline for PC invoicing by EURESCOM Deadline for PC prepayment by Shareholders Project work Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 PC invoicing by Shareholders Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 PC payment by EURESCOM at pay days Calendar Jan Feb March April May June July Aug Sept Oct Nov Dec Jan Feb Mar April 1999 EURESCOM page 10 (11)

14 APPENDIX 4: INVOICING AND PAYMENT CALENDAR FOR OPERATIONAL COSTS (OC) Deadline for invoicing EURESCOM Q1 Q2 Q3 Q4 Q1 Deadline for prepayment SH Q1 Q2 Q3 Q4 OC invoices and payment Q1 Q2 Q3 Q4 Calendar Jan Feb March April May June July Aug Sep Oct Nov Dec 1999 EURESCOM page 11 (11)

Financial overview. Jari Kinnunen CFO

Financial overview. Jari Kinnunen CFO Financial overview Jari Kinnunen CFO 1 Financial performance 2 Capital management 3 Cost allocation change 4 CFO priorities Financial performance Revenue growth continues, 2/3 with mid-single digits CAGR