Example: Selecting Items to be Paid
You have to pay several items, which are due on different days:
You have specified three days as a grace period for settling payables. The next payment run is to be made in seven days.
The payment program pays in the current payment run those items with a due date between the current payment run and the day before the following payment run (allowing for grace periods).
With a three day grace period
In this case, the payment program pays items one through three. These items were not considered for the previous payment run since the grace period permitted a later payment. Allowing for the grace period, the fourth item is not due for seven days, i.e. the day of the next payment run, and will therefore be paid then. The fifth item can be paid in the next payment run or at a later date.
With no grace period
If you do not define a grace period, the payment program would have paid the first item in the previous payment run. Items two, three and four will be paid in the current payment run and item five in the next run.