About secondary payees

The Secondary Payees window provides a way to add secondary payees to invoices. Secondary payees are most often involved with subcontractor invoices because they have sub-vendor suppliers who have lien rights to the project. It is critical to ensure that these suppliers get paid. The use of two-party checks provides this assurance.

There are several ways to enter the secondary payees. You can do so when you enter a new subcontractor’s invoice in the 4-2 Payable Invoices/Credits window by entering the name and amount payable to each supplier in the Secondary Payees window. You can also add one or more secondary payees to existing vendor invoices.

You will notice upon looking at the Secondary Payees window that it has three main parts: the grid, the vendor line, and the totals line.

The vendor line appears under the grid. The information in the vendor line reflects information related to the grid columns for the vendor on the invoice.

The totals line appears under the double line and reflects the entire invoice. The To Pay total reflects the sum of all To Pay amounts on this window. Upon saving it is sent back to its corresponding field at the bottom of the 4-2 Payable Invoices/Credits window.

Retention values are not reflected on this window. Retention that is entered on 4-2 Payable Invoices/Credits is held against the vendor’s balance. You cannot hold a portion of the invoice retention against a secondary payee; however, you can pay 90% on one check and the remaining 10% on a later check.

Discounts are not reflected on this screen. They are applied against the vendor’s balance. You cannot apply a portion of the invoice’s discount against the balance of a secondary payee.

After saving the information in the Secondary Payees window and subsequently the 4-2 Payable Invoices/Credits window, the next logical step could be to print and post the checks using the 4-3 Vendor Payments window. You will notice that the single invoice appears in the grid as multiple lines with the second payee lines directly under the vendor's portion. When you sort the grid, these lines stay together.

Here is an example. Suppose you subcontracted the electrical work on the construction of a home. Upon completion of the job, the subcontractor sends an $8,500 invoice, the amount of the contract. The invoice lists three suppliers and the associated costs: a materials supplier—$2,000; a lighting supplier—$1,500; and an equipment supplier for a backhoe to perform ground work—$300. To ensure that each of the subcontractor’s suppliers is paid, you can print a two-party check for each supplier.

When you print checks from the 4-3 Vendor Payments window, Sage 100 Contractor prints four checks based on the amounts in the Secondary Payees window. A check to the subcontractor and materials supplier for $2,000; a check to the subcontractor and lighting supplier for $1,500; a check to the subcontractor and equipment supplier for $300; and a check to the subcontractor for $4,700, which is the vendor’s portion that is not attributed to a second payee.

In additional, consider the following points:

• No information on the Secondary Payees window may be edited when the invoice has a status of 4-Paid or 5-Void.
• You can add multiple additional secondary payees to an invoice.
• You can change amounts to be paid to secondary payees as long as no payment has been made.
• You can change the name of the secondary payee as long as no payments have been made.
• You can remove secondary payees as long as no payments have been made.