FAQ

Payment Terms

  • Why is AEP changing its payment terms to 45-days?

    A 45-day payment term is a utility industry standard. Suppliers that regularly do business with utilities should be familiar with these payment terms.

  • How do I sign up for the Accelerated Payment Program?

    Option 1 – Standing Early Payment Option

    Currently an Ariba member?

    1. Please send an email to aribasupport@aep.com. Include the following information in the email: ”Please enroll my company in the Accelerated Payment Program; my assigned Ariba Network ID (ANID) is (xxxx).” Include your company name and your contact information.
    2. Once AEP receives your information we will email you the Trading Relationship Request that will serve to establish your company’s relationship with AEP. Log into your Ariba account and complete the Trading Relationship Request.
    3. After you accept the Trading Relationship Request, AEP will send you the Standing Early Payment Term offers to accept. There are three separate Standing Early Payment Term offers to choose from.
    4. Accept one the Standing Early Payment Term Offers.
    5. Mark the pending task complete for “READY TO RECEIVE EARLY PAYMENTS”. Setup is complete.

    Not an Ariba member?

    1. Join the Ariba Network by going to http://supplier.ariba.com.
    2. Click the Register as a New Supplier link and follow the short steps to create an Ariba account. It is free to join the network and free to sign-up for the Accelerated Payment Program
    3. Follow steps 1-5 above.

    Option 2 – On Demand Early Payment Option

    Currently an Ariba member?

    1. Send an email to aribasupport@aep.com. Include the following information in the email: ”Please enroll my company in the Accelerated Payment Program; my assigned Ariba Network ID (ANID) is (xxxx).” Include your company name and your contact information.
    2. Once AEP receives your information we will email you the Trading Relationship Request that will serve to establish your company’s relationship with AEP. Log into your Ariba account and complete the Trading Relationship Request.
    3. After you accept the Trading Relationship Request, AEP will send you Standing Accelerated Payment Term offers to accept. DO NOT ACCEPT ANY OF THE STANDING TERM OFFERS [IGNORE THE EMAILS].
    4. Log into your Ariba supplier account.
    5. Click on “All Offers” under Early Payment Terms on the right side of your supplier home page. Under the Notifications header click (check) the two boxes and add your email address.
    6. Mark the pending task complete for “READY TO RECEIVE EARLY PAYMENTS”. Setup is complete.

    Not an Ariba member?

    1. Join the Ariba Network by going to http://supplier.ariba.com.
    2. Click the Register as a New Supplier link and follow the short steps to create an Ariba account. It is free to join the network and free to sign-up for the Accelerated Payment Program
    3. Follow steps 1-6 above.

    Questions?

    For inquiries related to:
    eInvoicing through the Ariba Network: aribasupport@aep.com
    Questions about POs or Contracts: aribasupport@aep.com
    A specific invoice and/or invoice discount: apayable@aep.com

Accelerated Payment Program

  • What is AEP's Accelerated Payment Program?

    The Accelerated Payment Program is part of AEP's ongoing initiative to electronically transact with our suppliers. By making our processes more efficient, we are now able to offer our suppliers earlier payments. The Accelerated Payment Program delivers faster invoice payment in exchange for an agreed upon discount deducted from the gross invoice amount.

  • How will this program benefit my business?

    Some of the benefits to participating in AEP's Accelerated Payment Program include:

    • Accelerated Cash Flow - Participating suppliers can expect to accelerate turning receivables to cash from 45 days to as few as 6 days after invoice receipt
    • Reduced Days Sales Outstanding (DSO) - By accelerating conversion of receivables to cash, participating suppliers will reduce DSO and free up working capital for other needs
    • Control over Payment Timing - Participating suppliers have the opportunity to request automatic Accelerated payment on all invoices upon approval, or ASAP payment on individual invoices as cash flow needs dictate
  • What is an AEP approved invoice?

    Approved invoices are those which have passed all review processes (mechanized or manual) and been authorized for payment processing.

  • How is the discount calculated?

    The discount is calculated by determining the number of days between when the payment is initiated and the net due date of the invoice. The system then applies a discount in accordance with the discount terms agreed upon. This discount may be a set percentage of the face value or a sliding scale discount, depending on the accelerated payment offer that is accepted. For example, an accepted accelerated payment offer with terms of 2% 10 net 50 would equate to a 2% discount as long as the invoice was paid on or before the 10th day after the invoice was received.

  • Is the discount fixed?

    If you accept a standing accelerated payment offer without a sliding scale, then it is fixed until such a time that you and AEP agree upon new discount terms. If you accept a standing term accelerated payment with a sliding scale, the discount amount is prorated depending on the date of the payment.

    If you opt to accept Dynamic Accelerated Payment offers, then by nature the accelerated payment offer is dynamic and may change with the specific invoice opportunity. With this type of offer, you have the opportunity to review accelerated payment offers for each invoice and must accept them before accelerated payment is initiated.

  • What is the difference between Standing Accelerated Payment and Dynamic Accelerated Payment offers?

    Standing Accelerated Payment offers apply to all invoices that you submit that are approved to be paid within the parameters of the agreed upon terms. If you have agreed to a Standing Accelerated Payment term, Accelerated payment will be executed automatically and immediately upon invoice approval without any further intervention by you or AEP.

    Dynamic Accelerated Payment offers are ad hoc offers initiated by AEP that apply to a specific invoice or group of invoices. Once the dynamic offer is made, the supplier is notified via email and an alert on the Ariba Network. The supplier must then review and accept the offer online within the Ariba Network account at which point the Accelerated payment is initiated. This review can be done manually or through automated acceptance rules defined in the supplier Ariba Network account.

  • I only want to review Dynamic Accelerated Payment offers if they meet certain parameters. Is there any way to set filters or automate my review of these offers?

    Yes. If there are certain calendar dates and/or accelerated payment terms that you would always like to accept or reject, the Ariba Network enables you to define those rules within your Ariba account. Once rules are defined, only those accelerated payment offers falling outside of those parameters will need to be manually reviewed by you in order to take effect.

  • What happens if I do not review an Accelerated Payment offer?

    Nothing. If you do not review or choose not to take action on an accelerated payment offer, whether standing or dynamic, invoices will be paid according to each invoice's net terms.

  • Understanding when payments will be made is important to my business. Is there a way for me to gain visibility into my invoice status and payment schedule?

    Yes. This is a great benefit for our suppliers of AEP's e-Invoicing initiative. If you are registered and send your invoices to AEP through the Ariba Network, then your invoice status and settlement date are displayed within your account for your convenience. Additionally, you can use Ariba's Cash Flow Optimizer tool to identify and define which invoices will be paid when to meet specific cash flow needs you may have.

  • I do not need to be paid early all the time, but my business does have periodic needs for accelerated cash flow. Does this program accommodate that?

    Yes. AEP may make a Dynamic Accelerated Payment offer for a particular invoice or set of invoices to you which you can review and choose to accept or not based on your business needs at the moment.

  • What is a "sliding scale" discount?

    A sliding scale discount is an accelerated payment term where the amount of the invoice discount decreases the closer the accelerated payment comes to the net term due date. A sliding scale discount takes into account the variable timing of invoice approval and enables you to receive early payment regardless of when the invoice is approved to pay.

    For example, with a standard 2%/10 net 30 accelerated payment term, you would give AEP a 2% discount in order to be paid 20 days Accelerated. If the invoice is approved on day 5, AEP would wait until day 10 to pay you. Alternatively, if the invoice is not approved until day 15, AEP would wait to pay you until the full 30 day term of that invoice, thus costing you valuable accelerated cash flow.

    With a sliding scale applied to your accelerated payment term, you would receive early payment on whatever day the invoice is approved with the discount amount sliding up or down depending on how quickly payment accelerated to you. Using the above examples for a 2%/10 net 30 invoice term, if the invoice is approved on day 5, payment would be executed on day 5 for a 2.5% discount. Alternatively if the invoice is approved on day 15, an Accelerated payment will still be executed immediately, but the discount will be reduced to 1.5% of the invoice value.

  • Do I have to receive early payment via ACH or can I be paid by check as I am now?

    In order to participate in AEP's Accelerated Payment Program, you must be setup to receive an ACH credit electronically. Accelerated payments will not be made by check as the time needed for the check to be processed, mailed and settled would greatly limit the opportunity for Accelerated payment to be received in a timely manner. Currently, over 85% of our vendor payments are made by ACH credit. An email is sent the day prior to receipt of funds listing the invoice number (s) and dollar amount (s) being paid.

  • What if I get paid via check now? How do I sign up to get paid electronically (or change my bank information) in order to take advantage of the accelerated payment opportunity?

    Use AEP's Financial EDI authorization form. The return of the completed form will provide for set-up of ACH credit as the payment method and enable your company to take advantage of the accelerated payment program.

    Questions?

    For inquiries related to:
    eInvoicing through the Ariba Network: aribasupport@aep.com
    Questions about POs or Contracts: aribasupport@aep.com
    A specific invoice and/or invoice discount: apayable@aep.com

eInvoicing

  • What is eInvoicing?

    eInvoicing is the process of receiving POs, confirming orders and submitting invoices electronically via the Ariba Network. Invoices automatically post within PeopleSoft and are released for payment according to payment terms. Suppliers receive order notifications, transaction histories and full audit trails via the Ariba Network.

  • What is the Ariba Network?

    The Ariba Network is the world's largest trading partner community, home to more than 730,000 companies, including more than half of the Fortune 500. Ariba provides fast transmission, tracking and processing of orders and invoices.

    The Ariba Network has been selected by AEP as the preferred method for sending purchase orders and receiving PO invoices.

  • Will all suppliers be required to join the Ariba Network?

    Suppliers will be encouraged to join the network but not required. Not all suppliers will be contacted to join the network.

  • Can suppliers see status of POs and Invoices in Ariba if they join the network?

    Suppliers will be able to see the following statuses for invoices once received and/or processed in PeopleSoft:

    • Processed
    • Paying
    • Paid
    • Rejected
    • Canceled
  • Are there consequences for suppliers that do not join the Ariba Network?

    Participation in the program will be an evaluation factor that AEP considers when selecting suppliers or reviewing suppliers for renewal.

    Questions?

    For inquiries related to:
    eInvoicing through the Ariba Network: aribasupport@aep.com
    Questions about POs or Contracts: aribasupport@aep.com
    A specific invoice and/or invoice discount: apayable@aep.com

Invoice Payment Process

  • Why have we not received payment on a past-due invoice?

    Common reasons for delayed payment include:

    The invoice has not been received by AEP’s Accounts Payable Department.

    Resolution:

    1. AEP’s Accounts Payable Department will ask the vendor for a copy of the invoice.
    2. Once the invoice has been matched with all appropriate back-up material (e.g. a receipt of goods, required approvals, etc.) the payment should be processed.

    The invoice is missing information or contains inaccurate information.

    Resolution:

    1. AEP’s Accounts Payable Department will attempt to obtain missing information or correct the inaccurate information.
    2. If attempts to gather the required information are not successful, the Accounts Payable Department may return the invoice to the vendor for clarification. See the invoice template and invoice requirements for more information.

    The invoice price does not match the prenegotiated price on the Purchase Order.

    Resolution:

    1. AEP’s Accounts Payable Department will contact the appropriate AEP buyer to determine which price is accurate based on set blanket order pricing or vendor quotation.
    2. If the Purchase Order price is accurate (and the invoiced amount is inaccurate), the invoice total will be adjusted to reflect Purchase Order pricing.
    3. If the invoice amount is accurate (and the Purchase Order price is inaccurate), the payment will be issued for the amount specified on the invoice and the Purchase Order will be adjusted accordingly.

    The invoice is not approved by an AEP representative.

    Resolution:

    1. If an invoice has been routed for an AEP representative’s approval but approval has not been obtained within a specified time frame, the invoice will be assigned to an Accounts Payable resolution team member for further investigation. NOTE: Every invoice should reference a Purchase Order Number or a Contract Number. If no Purchase Order Number or Contract Number is referenced on the invoice, the name of the individual who has ordered the merchandise should be provided to avoid delayed payment resulting from approver identification issues.

    Issues when receiving goods, including:

    The ordered material wasn’t delivered to the correct location.

    Resolution:

    1. AEP’s Accounts Payable Department will request that the vendor supply a proof of delivery.
    2. Based on information provided on the proof of delivery, an Accounts Payable Representative will determine the location to which the material was delivered and provide that information to the receipting storeroom.
    3. The receipting storeroom will verify the receipt of the goods and process a receipt, which will facilitate the payment process.

    The quantity of goods received does not match the quantity of goods invoiced.

    Resolution:

    1. AEP’s Accounts Payable Department will contact the receiving storeroom for verification of the quantity received and perhaps request proof of delivery from vendor to justify the invoiced quantity.

    2. If the invoiced quantity is inaccurate, the Accounts Payable department will authorize for payment only the amount associated with the correct amount of received goods.

    3. If there was an error by the storeroom staff in receipting for the goods, the receipt of goods will be adjusted to reflect the correct amount and payment will be processed accordingly.

    Delays in the routing of the packing list/shipping documents from outlying (remote) locations to the main inventory (receipting) location.

    Resolution:

    1. Because material is sometimes delivered directly to a job site instead of a receipting storeroom location, it is important that all invoices specifically outline the location to which the goods are shipped as well as the name of the AEP contact, if available. This will ensure that, if the necessary paperwork is not forwarded properly within AEP, the Accounts Payable Department can provide that information to the receipting storeroom.
    2. The receipting storeroom will verify the receipt of goods at the “remote” location and process a receipt, which will facilitate the payment process.

    The shipment is lost, damaged or incorrect.

    Resolution:

    1. If incorrect material is received, AEP’s storeroom will contact the vendor to obtain a Return Material Authorization (RMA) and return instructions.
    2. If a shipment is lost or damaged and the shipping terms indicate the responsibility belongs to AEP, the storeroom will acknowledge the receipt of the goods and initiate a freight claim with the carrier. Once the storeroom has receipted for the goods, the payment process will continue. If responsibility belongs to the shipper, payment will be delayed until the replacement shipment is received.

    Material is shipped against a cancelled or expired Purchase Order.

    Resolution:

    1. If an order has been placed against a canceled or expired Purchase Order, AEP’s Accounts Payable Department will contact the storeroom to determine whether the material will be accepted or returned to the vendor.
    2. If the order is accepted, AEP’s Accounts Payable Department will either contact the appropriate AEP buyer to issue a replacement Purchase Order or will approve the payment of the invoice by treating it as a “non-PO” order (generally only done under specific circumstances). In either event, the payment to the vendor will be issued as appropriate.
    3. If AEP determines that the shipment made against the invalid Purchase Order will not be accepted, the storeroom will request a Return Material Authorization from the vendor.
  • Why did AEP deduct sales tax from its payment to our company?

    In certain instances, AEP has received approval from the tax authority to pay sales tax directly to the specific state and/or locality. In such instances, AEP will not pay sales tax through its vendors (even though the invoice might include sales tax). See direct pay permit information.

  • Why did AEP not pay the entire invoiced amount?

    If the short pay was not related to AEP’s “direct pay” arrangement (as described in Question 2), the short payment could have been the result of a discrepancy between the invoiced price and the pre-arranged price outlined in the original Purchase Order. In that case, AEP’s Accounts Payable Department will contact the appropriate buyer to investigate the discrepancy. To resolve this issue, the buyer can either revise the Purchase Order to reflect the correct price or advise the Accounts Payable Department to short pay the invoice.

  • Why did AEP deduct freight charges from the payment?

    When the Purchase Order is initiated it outlines the Free On Board (FOB) and other shipping terms. If the vendor does not follow the terms outlined on the Purchase Order, AEP’s buyer may advise AEP’s Accounts Payable Department to deduct all non-approved freight charges from the payment. If a “collect” freight bill was already paid directly to the carrier by AEP for a particular shipment, the buyer also may advise the Accounts Payable Department to deduct from the payment any added freight charges for that shipment.

  • Who can I contact to check the status of a payment?

    All telephone inquiries should be directed to AEP’s Accounts Payable Call Center at (330) 438-7102. In the event the Call Center cannot provide payment information, the attendant will direct the inquiry to a team member for investigation and resolution.