GPC 13th Month Cycle – What, Why, and When?
By Gregory Anthony, SAF/FMP
Originally written 10 Sep 2012
What is a 13th month cycle?
It is an extra billing cycle, requested by the USAF, for pay and confirm accounts that are EDI-enabled (making payments electronically). It usually covers the period from September 20th through October 2nd.
Why is there a 13th month cycle?
The purpose is to maximize rebates. Rebates are earned based on two factors, amount of spend and speed of payment. Speed of payment means that the quicker the bill is paid, the lower the file turn and the higher the rebates are going to be. Since there are always many high-dollar purchases made toward the end of September, typically these purchases would not be invoiced until after the normal October cycle, or October 19th. So they wouldn’t be paid probably until the end of October at the earliest. The 13th month cycle enables the USAF to receive an invoice to capture as many of those end-of-year purchases as possible so that a quick payment can be made, which maximizes the rebate being paid in January of the next FY covering the first fiscal quarter.
When will we see the 13th month cycle?
The 13th month cycle will be created by TSYS, Total Systems (U.S. Bank’s processor) the night of October 2nd. It will be visible the morning of October 3rd to all Access Online users. Once created, it is ready for financial managers to certify accounts for payment. Financial managers may want to circle this date on their calendars to remind them to accomplish these certifications as quickly as possible in order to maximize rebates. Likewise, all cardholders and approving officials should immediately finalize the process of account approvals. The 13th month cycle is treated just like all the other billing cycles that occur during the year. From September 20th through October 2nd, all Access Online users will see what appears to be the normal October cycle starting on September 20th. However, this will change on October 3rd, once the 13th month cycle is created and displayed. October 3rd will actually be the first day of the normal October cycle, which will close out on October 19th.
Why does the 13th month cycle close out in October?
At the earliest, it takes a minimum of couple days for merchants to process transactions and for the transactions to appear on a cardholder’s statement. By closing out the 13th month cycle on October 2nd, it prevents any purchases being made on October 1st from sneaking onto a statement meant for end of prior year purchases.