For those who oversee a vessel’s operations, a crucial consideration is the cost incurred during a port call. Transported cargo must be unloaded, crew must be changed, any necessary repairs and inspections must be performed, plus many more.
To anticipate the cost of such visits, companies, charterers or their owners must plan ahead to prepare for these costs, often enlisting the help of an agency to prepare the necessary financial documents. So, what is a PDA and FDA in shipping?
PDA (Proforma Disbursement Account) and FDA (Final Disbursement Account) are financial documents vital during a port call. A PDA shows an estimate of costs that will be incurred by an agent in provision of the services required by a company during a port visit, and an FDA describes in detail the actual costs that have been incurred by the agent.
Read on to find out more about PDA and FDA in shipping.
Disbursement accounts
A disbursement is simply a cost that must be covered during a vessel’s time in port. By pre-planning the costs that will be incurred during a port visit, disbursement accounts allow the charterer or operator to ensure that the vessel is not incurring any unnecessary charges.
What are the key disbursement accounts?
Often, disbursement accounts are prepared by an agency. This helps the operator to save both time and money.
Proforma Disbursement Account
A PDA is an estimate of the charges related to a vessel that will be incurred during a port visit. With the information being collected by an agent acting on behalf of the vessel operator, the PDA estimates the financial toll of completing a port visit.
A PDA is dependent on the following elements:
- The port that is visited
- The operation of the cargo
- The type of cargo
- The quantity of the cargo
Final Disbursement Account
The final disbursement account is the actual cost that the port visit incurred to the agency. Normally, an agency that supplies a PDA will aim to send the FDA to their customer within 72 hours of vessel departure from the port, with a target accuracy of around +/- 2-3%.
An accurate FDA helps in planning dock time, any repairs that are necessary, and the frequency of port visits that are possible on the voyage.
Can I produce disbursement accounts without the help of an agency?
While it is perfectly acceptable to produce your own disbursement accounts, it is a highly involved process. To prepare a disbursement account, you must identify a vessel’s needs, gather cost estimates, determine any sources of funding, and ensure that the correct template is populated with accurate and reliable data.
By enlisting the services of an agency, the time that is spent during port calls is reduced, as PDAs often require operators to pre-fund the estimated cost.
This means that whether the FDA shows an increased or decreased amount, the vessel can continue to operate as normal.
Disbursement accounts made simple
If you are looking to improve efficiency, save money, and enhance the compliance and transparency of your disbursement accounts, contact us today to see how our solutions can help you.
We provide an easy-to-use platform to automate all of your disbursement accounts and payments, removing the need for lengthy processes and paperwork to improve your operational efficiency.
Read our full guide to find out how DA-Desk can help streamline your disbursement accounts.
Choosing a disbursement accounting platform: 6 critical areas to assess
Read our our recent post on the best questions to ask when you choose a disbursement accounting automation partner.
