Performance Certificates- Uncompleted Job

Objective

• To capture how to process performance certificates for uncompleted jobs in order to recognized liability for job done to date by the supplier, contractors and service provider

Introduction

• This relates to when a supplier, a contractor or a service provider  of an uncompleted job process a performance certificate as evidence of job done to date .
• The performance certificate is needed for the company to recognize liability to the supplier, contractor or service provided for job done to date.
• When value of performance certificates to date is more than the total payments to the supplier to date , the supplier will be entitled to additional payment to the extent of the difference.
• Advance payments on the job will cause the supplier , contractor or service provider to be categorized as debtors or account receivables.
• The only way to redeem the debt is through approved performance certificates that recognizes liability by the company to the supplier to the tune of the value of the approved performance certificates.
• Meaning that the account of the supplier or contractor and service provider is to be credited with the value of the performance certificate

Process

1. Go to Supplier Management Center>>Transaction>>Direct Booking>>Performance Certificates
2. Click the (+) button and the select the create performance certificate document screen opens as shown below.

Create Doc-Additional Payment

1. Click the create document button for the supplier document number in question
2. Create button opens the performance certificate header screen as below

Performance Certificate-Header

1. System displays relevant financial information about the contract to guide the user
2. Insert the performance certificate value
3. Insert retention amount, if any . System will retain the entered amount automatically .
4. System validates to ensure that performance certificate value will not cause total certificates value to be more than the approved contract sum
5. Insert payment term
6. Complete other relevant fields
7. Attaches relevant documentary evidence
8. Click create batch button
9. System opens the detail section screen as below

Performance Certificate-Detail

1. Select the item detail relating to the performance certificate using the search box
2. Insert more information under the Addition Information Box
3. The Quantity Unit is default to one.
4. Insert the value of the selected item under cost per unit
5. Cost per unit ( VAT Exc) field is displayed
   • This is extended cost before VAT
6. At the right display box section, system displays the VAT on the item as well as withholding tax based on the tax settings for the selected item in focus
7. The net payable net of taxes is also displayed
8. Click the create entry button
9. The system list the entry under the list box below.
10. Multiple entries can be created
11. Ensure total net value of all detailed items listed is equal to the control net value of performance certificate value at the header.
12. Click Submit for procession button
13. The transaction follows the defined workflow approval route
14. At final approval
    • System automatically updates the supplier/contractor/service provider accounts as well as relevant contra accounts as defined for the selected items at the detail section in other to recognized the liability for the performance certificate
    • System determines if the the value of the approved performance certificate to date is more than the total payments to date on the contract to date, the excess is treated as bill to be processed for payment after deducting any specified retention.
    • System validates the due date and auto send excess bill to the Undue Approved Bills if bill is not yet due and to Bill Payment Engine if the bill is due for payment processing of the excess amount net of retention