Your accounts can prove how quickly you pay suppliers

Xero announced its Supplier Days to Pay Detail report on 7 October. The report shows how long each paid bill took for every supplier in a chosen period, groups results into 0 to 30, 31 to 60, 61 to 90 and over 90 days, and lets users export the underlying data.

Xero developed the report with the Office of the Small Business Commissioner. Its immediate purpose is to make evidence gathering easier for businesses applying to the Fair Payment Code. Xero said the feature would reach all customers by the end of this week.

The Code is a voluntary award scheme. A Gold Award requires at least 95% of all invoices to be paid within 30 days. Silver requires at least 95% within 60 days, including at least 95% of invoices to small businesses within 30 days. Bronze requires at least 95% within 60 days. Applicants also agree to be clear, fair and collaborative with suppliers.

A UK registered business or organisation of any size can apply if it can evidence the criteria and principles. There is no charge to join. The criteria do not create a new legal payment deadline for private businesses.

The same report can expose process problems even when an application is outside your plans. A cluster of bills moving beyond 30 days can point to slow approvals, missing purchase-order details or a payment run that is too infrequent. Check the source records before drawing a conclusion, because the result depends on the bills and payment dates recorded in the accounting system.

On Monday, export the last three months. Calculate the share of paid bills completed within 30 and 60 days, then inspect the five slowest payments. Give one person responsibility for the clearest process fix and check the same report after the next payment run.