Western Australian government agencies spend billions of dollars on goods and services each year, most purchased from local suppliers. Agencies have a responsibility to pay for goods and services in a timely manner, thereby helping local industry to remain viable, and protecting the jobs of those who work for suppliers.
Treasurer’s Instruction (TI) 323 Timely Payment of Accounts requires all payments to be made within 30 days of the receipt of the invoice, or within 30 days of receiving the goods or services (whichever is later). The TI is mandatory for agencies that fall under the Financial Management Act 2006, but we also consider it good practice for other government entities.
We last reported on timeliness of payments in 2014. In that audit, we reviewed 10 agencies and found that 10% of payments were made after 30 days and without a valid reason for the excessive delay. We found several areas where agencies could improve their procedures and controls for managing timely payments, with only 1 agency rated as good across our lines of inquiry.