A payment structure defines how an order is to be paid, in one or more tranches.

You can create a payment structure in your local directory, and then apply it to an order, or you can create it on the fly from a given order.

Each tranche represents a percentage of the total order amount (including tax) to be paid according to a specific payment term.

These tranches then serve as the basis for creating the commitments, which are the actual financial obligations that arise from the order. A tranche may be linked to one or more commitments, depending on its payment term.

Sum of Percentages

The sum of percentages of all portions/tranches in a payment structure must equal a specific total based on the selected nature of the contract or order, as follows:

• Commercial contracts: +100%
  • The order’s contributions are products.
  • There are two types of tranches, both path of the order’s remuneration:
    • Initial remuneration: one or more positive portions, totalling 100% or more. These represent the upfront price paid by the client .
    • Rebates: one or more negative portions. These are rebates or refunds paid by the supplier(outflows for the supplier, inflows for the client).
  • The sum of percentages must be exactly 100%.
  • The total order amount is thus equal to the initial remuneration minus the rebates.
• Funding contracts: 0%
  • Both the order’s contribution and its remuneration are payments.
  • There are two types of tranches:
    • Funding (contribution): one or more negative portions, totalling exactly -100%, representing the initial funding amount (outflows for the supplier/investor, inflows for the client/recipient),
    • Reimbursement (remuneration): one or more positive portions, totalling exactly 100%, representing the reimbursement of the funding amount (inflows for the supplier/investor, outflows for the recipient),
  • The sum of percentages must be exactly 0%,
  • This means that the principal amount of the reimbursement (i.e. excluding interest and return on investor) is equal to the initial funding amount (also equal to the total order amount).
• Grant contracts: 100%
  • The order’s contributions are payments. There is no remuneration.
  • Tranches represent the the contribution only:
    • Grant: one or more negative portions, totalling exactly -100% (outlows for the supplier/donor),
  • There is no reimbursement of the grant, so the sum of all portions must be exactly -100%.
• Transfer contracts: +100%
  • The order’s contributions are commitments (i.e. financial obligations arising from other contracts).
  • There are two types of tranches:
    • Transfer (contribution): each one is linked to a specific commitment that is being transferred.
      • Their percentages represent the percentage of the commitment that is being transferred.
      • Each percentage must be more than 0% and less or equal to 100%.
    • Regular (remuneration): one or more positive portions (inflows for the supplier and outflows for the client).
  • The sum of percentages for regular tranches must be exactly 100%. The percentage of the transfer tranches is not taken into account .