SOUTHERN WATER SERVICES LIMITED

Standard payment terms

Southern Water policy is to establish any new contractual arrangement based on 60-day payment terms. However, as part of the regulated negotiated procurement process, we will consider the commercial benefit of negotiating shorter payment terms. In addition, as part of our approach to Corporate and Social responsibility we will consider the application of 30-day payment terms for appropriate Small and Medium Enterprises.

Were there any changes to the standard payment terms in the reporting period?

No information available

Any other information about payment terms

Southern Water operates a range of payment mechanisms including direct debit, Purchasing Cards and BACS. Our core system is SAP and we have a three-way match between the purchase order, goods receipt and invoice details. To avoid delays in payment Southern Water requests suppliers to: • Ensure that they have a valid and current purchase order number • Send all documents and credit notes by email to SouthernWater@DOL.co.uk in PDF format. If sending more than one invoice in the same email, please provide a separate file attachment for each document • Only submitting them when goods or services have been delivered • Not split invoices against multiple purchase orders If suppliers are unable to utilise email, invoices and credit notes should be sent direct to Accounts Payable, Southern Water, Southern House, Yeoman Road, Worthing BN13 3NX. We have a small number of ‘term-contractors’ undertaking construction and infrastructure maintenance work. These contractors’ issue monthly applications for payment covering a very large number of individual jobs. In accordance with the guidance each of these jobs has been treated as an individual invoice payment even though they are paid on a consolidated invoice. As a result, the performance statistics reported are significantly influenced by the timing of payment of 161 consolidated invoices which are treated as over 79,000 invoices in the calculations. As part of our management of cash over the course of our financial year end (March 25), the timing of payments for 23 of these consolidated invoices, representing over 20,000 invoices, were deferred with the full agreement of the suppliers. The classification of these payments into the specific time bandings for this report is the main driver for the change in our reported performance from prior periods. The underlying performance of our payments to other suppliers is as follows: Average time to pay 40 days Within 30 days 43% In 30 to 60 days 46% Over 60 days 11% Invoices due but not paid to agreed terms 21%

Maximum contractual payment period agreed

60

Has this business signed up to a code of conduct or standards on payment practices?

For example, signatories to The Prompt Payment Code must commit to paying 95% of their invoices within 60 days.

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Does this business offer e-invoicing in relation to qualifying contracts?

This is where suppliers can electronically submit and track invoices. It's not just allowing suppliers to email them an invoice.

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Does this business offer supply chain finance?

This is where a supplier who has submitted an invoice can be paid by a third-party finance provider earlier than the agreed payment date. The business would then pay the finance provider the invoiced sum.

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Under its payment practices and policies, can this business deduct sums from payments under qualifying contracts as a charge for remaining on a supplier list?

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During the reporting period, did the business deduct sums from payments as a charge for remaining on a supplier list?

No information available