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Alternate Payee

Generally, the alternate payee functionality makes the main vendor account easier and more flexible to use and reduces the reliance on the OTA (One-Time-Only-Account) vendor accounts.

Here are some frequently asked questions:

When is it appropriate to redirect a regular vendor payment to an Alternate Payee Address?

When should an Alternate Payee Address be used in place of an OTA vendor account?

When should an OTA vendor account be used?

When should I ask Procurement Services to set-up a new vendor account?

What are the benefits of using a vendor account?

Any further questions?

 

When is it appropriate to redirect a regular vendor payment to an Alternate Payee Address?

  • When you need to send a cheque with attachments.
  • When you need to present a cheque in person.
  • When you need to direct a cheque to a specific destination within a vendor’s organization (e.g., PO Box, specific department, division)
  • When a vendor is a conglomerate of individual operating entities.

 

When should an Alternate Payee Address be used in place of an OTA vendor account?

  • If a vendor account exists the Alternate Payee Address should be used in all circumstances.

 

When should an OTA vendor account be used?

  • The OTA vendor account should be used only when ALL OF THE FOLLOWING CONDITIONS EXIST:
    • A vendor account does not exist
    • The transaction size does not exceed $4,999.99
    • You do not anticipate using the vendor more than once in a fiscal year
    • In addition to the conditions above, using an OTA vendor account is NOT RECOMMENDED if:
      • You will be relying on the supplier to provide warranty or support services for a period greater than 12-months.
      • You are purchasing recurring services to be rendered after the payment is made in full.

 

When should I ask Procurement Services to set-up a new vendor account?

  • A vendor account does not exist (*)
  • The transaction size exceeds $4,999.99
  • You anticipate using the vendor more than once in a fiscal year
  • You will be relying on the supplier to provide warranty or support services for a period greater than 12-months.
  • You are purchasing recurring services to be rendered after the payment is made in full.

(*) Prior to a new vendor accounts being created, the applicant is vetted with an independent rating agency to help procurement services identify a vendor in poor financial health and therefore at higher risk of failure.

 

What are the benefits of using a vendor account?

  • Using a vendor account provides higher assurance that the vendor is a legitimate entity with acceptable financial stability.
  • Credit memos can only be processed using a regular vendor account. Credit memos cannot be processed using an OTA vendor account.
  • Using a vendor account makes it easier to capture all payment history with a particular a vendor which is used:
    • To negotiate better discounts for end users
    • To assist Development and International, Government & Institutional Relations activities
  • Using a vendor account makes it easier to capture commodity information to determine not only from whom we are buying but WHAT we are buying. This information is used to help determine if there is a better source, or sourcing strategy, to benefit end users. (e.g. eProcurement, collaboration with other institutions, bulk buys, etc.)
  • When payment history is captured, Procurement Services is better able to engage key end users in vendor evaluation activities.

 

Any further questions?

If you have further questions, please do not hesitate to contact us , or your F.A.S.T. Team Representative .