Agencies that fail to make payment by the payment due date are required to pay a late
interest penalty. The formulas available below can be used to calculate simple daily
interest and monthly compounding interest. The Prompt Pay interest rate in effect on the
first day after the payment was due, available below, should be used in both of these
Determining the Purchase
Card Invoice Payment Date
The revised Prompt Pay regulation requires agencies to determine Government-wide
commercial purchase card payment dates based on an analysis of the total benefits to the
federal government as a whole.
Calculating Purchase Card
Invoice Payment Date
Includes a spreadsheet that may be used by agencies to determine when
to pay purchase card invoices. This site also includes a manual calculation
which may be used by agencies that choose not to use the spreadsheet.
To be used by federal agencies to evaluate the cost-effectiveness of
a cash discount. See section 8040.40 of Treasury's Cash Management Regulations
I TFM 6-8000 for the formula.
Value of Funds Rate(Effective until December 31, 2007) Treasury's Cash Management Regulations I TFM 6-8000 prescribes the
use of this rate by agencies as a comparison point in evaluating the
cost-effectiveness of a cash discount. Please note that the current
value of funds rate changed from 2% to 4% on July 1, 2006.