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Oracle® Fusion Procurement, Supplier Contracts and Agreements Guide
11g Release 5 (11.1.5)
Part Number E22850-06
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Authoring Contract Terms: How It Works

How can I configure contract terms before I print them

Editing Contract Terms in the Clauses Tab: Explained

Authoring Contract Terms: How It Works

This topic provides an overview of contract terms authoring on the Contract Terms tab when you create or edit the contract by selecting the Create Contract and Edit Contract tasks in the Manage Contracts page or the Contracts work area.

Just what actions you can take during contract terms authoring depends on your implementation, your privileges, and contract type. Some contracts may have their contract terms already populated from a contract terms template and permit you only to add and delete clauses from the Contract Terms Library. Other contracts may allow you to create nonstandard clauses or require you to answer questions to determine if additional clauses are required. For some contracts, you may attach the contract terms in a separate document and not use the authoring capabilities of the application at all.

The following diagram outlines the contract terms authoring process:

  1. If the contract terms are not applied in the Contract Terms tab, then you must add them either by selecting a contract terms template or by attaching the contract terms in a file. Choosing a contract terms template populates the tab with the contract terms from that template and permits you to edit them in the application. If you choose to attach the contract terms as a document, then you must continue to work outside the application.

  2. Some contract terms templates require you to run the Contract Expert feature and enter additional information to determine if more clauses are required.

  3. You can edit the contract terms either in the application or outside the application using Microsoft Word 2007.

  4. You must enter any missing values for variables.

  5. Optionally, you can change the contract terms source, either switching to a different contract terms template or attaching the terms in a document. Alternately, you can remove all of the contract terms completely.

  6. You can also check for any clause updates in the Contract Terms Library.

  7. You can run a report detailing the changes you made to the contract terms applied from a template and have the deviations report submitted for approval along with the contract.

  8. The last step before submitting the contract for approval is to validate your contract terms and eliminate any errors.

This graphic provides an overview of
contract terms authoring.

Specifying the Source of Contract Terms

The first step in the contract terms authoring process is to specify the source of your contract terms. The contract source can be either a contract terms template or an external document.

In some contracts, the contract terms are applied automatically from contract terms templates based on rules set up by the Contract Terms Library administrator. In other contracts, you must add the contract terms yourself. You can either accept the template recommended by the application, choose a different template, or attach the contract terms in a separate document.

Depending on your permissions, you can change the source of the contract terms at any time during the authoring process by selecting the Change Contract Source action.

Running Contract Expert

Some contract terms templates require you to run the Contract Expert feature to determine if additional clauses must be added. You can tell if you must run Contract Expert when the Clauses tab includes the Contract Expert Last Run indicator above the contract terms preview region. When you run Contract Expert by selecting the Run Contract Expert action, Contract Expert may ask you to enter values for contract variables and to answer questions. If you do not run Contract Expert on a contract that requires it, then you receive an warning message during contract validation.

Editing Contract Terms

Depending on the contract , you can, add, move, and delete clauses and sections. For example, you can add standard clauses, substitute alternate clauses for existing clauses, edit standard clauses or create nonstandard clauses that are specific to the contract.

You edit the contract terms by using the outline on the left side of the Clauses tab. You preview the clauses on the right.

You can also edit the contract terms outside the application using Microsoft Word 2007. You select the Download Contract action to export the contract terms to a file, make your edits, and select the Upload Contract action to import your changes back into the application.

Entering Missing Variable Values

Select the Edit Variable Values action to enter any missing variable values. The Clauses tab displays the number of missing values in the Pending Variables indicator. You must enter any missing values before you submit the contract for approval. Missing variable values generate warnings during contract validation.

Entering variable values using this action is equivalent to entering these values when running Contract Expert.

Checking for Clause Updates

Select the Check for Clause Updates action to check if a more recent clause version is available in the Contract Terms Library.

Changing the Contract Source and Removing Contract Terms

Select the Change Contract Source action to change the source of the contract terms from one template to another, from a template to an attachment, or from an attachment to a template.

If you change templates, the application removes all sections and clauses added by the original template, including any you have edited. Only new clauses you added are kept under the Unassigned section heading.

If you decide to attach the contract terms in a file to replace those from a template, then you have the option of retaining the terms from the template for reference. If you replace attached contract terms with those from a template, then the attachment is stored as one of the contract documents.

Select the Remove Contract Terms action to remove all contract terms from the contract. Removing contract terms removes all contract terms documents.

Reviewing Deviations and Validating Contract Terms

Select the Review Contract Deviations action to generate a report that lists differences between the contract terms in the contract and the contract terms in the contract terms template. The deviations report lists:

You can attach the report with your comments to the notification the application sends to approvers when the contract is submitted for approval. The report is automatically refreshed at the time the contract is submitted to ensure it contains the latest information.

Select the Validate Contract Terms action to determine if the contract terms are ready to be submitted for approval. Validation can generate both errors and warnings. You must correct the errors. Correcting the warnings is optional.

For example, you receive an error if:

You receive a warning if you did not run Contract Expert as required by the contract terms template or you did not answer all of the Contract Expert questions.

The application runs the validation process automatically when you attempt to submit the contract for approval, and displays any remaining errors and warnings at that time.

How can I configure contract terms before I print them?

You define contract terms layout templates during contract type setup. Contract printing uses these predefined layout templates. You can also configure the printing options available on the page when creating and editing clauses and when adding and editing sections as part of contract or template authoring.

You can

Note

As the numbering is part of the title of the section or clause, choosing to suppress the title automatically suppresses the number, skipping numbering and moving the numbering up one level for subsections and clauses in that section, and sections and clauses in the contract.

These printing options are only available for contracts in Draft and Under Amendment statuses. Although, you can use these printing options on all templates including those for which approved contracts exist, the options you select will only apply to future, yet to be approved contracts. These printing configurations only show in the pdf, rtf, and html outputs of the contract.

Editing Contract Terms in the Clauses Tab: Explained

Depending on your permissions, the contract type, and the contract status, you can edit the contract terms displayed in the Clauses tab by using the outline on the left and the Actions menu. You must refresh the preview pane on the right to see the results of your edits.

On the Clauses tab you can:

Editing Clauses

You can add standard clauses; add, delete, or move clauses; select alternate clauses; and create nonstandard clauses either by editing standard clauses or by creating a completely new clause. Different clause types permit different actions. For example, you can only select alternate clauses for clauses where alternates are available and you cannot edit protected clauses or delete mandatory clauses unless you have special permissions. Mandatory and nonstandard clauses are highlighted with icons as are clauses with available alternates.

The following table summarizes what actions are available for different clause types.


Clause

Available Actions

Standard

  • Add

  • Move

  • Delete

  • Edit to create a nonstandard clause

Nonstandard

  • Create by adding and editing a standard clause or create an entirely new nonstandard clause

  • Move

  • Delete

  • Edit

Protected

  • Add

  • Move

  • Delete

  • Edit only with special privileges

Mandatory

  • Move

  • Delete only with special privileges

  • Edit only with special privileges

Alternate

  • Move

  • Edit to create a nonstandard clause

  • Delete

  • Select an alternate clause

Editing Sections

You can add, edit, delete, and move sections. When you move or delete a section, you move or delete its contents provided you have the permission to do so. For instance, you cannot delete a section if that section includes a mandatory clause and you do not have the special permission required to delete such clauses. When adding or editing a section, you have the option of selecting predefined sections from the Contract Terms Library or creating your own.

Changing the Numbering Style

You can change the numbering style of the contract terms by selecting the Change Numbering Scheme action.

Adding Contract Terms from a Template or as an Attachment: Points to Consider

When no contract terms are applied to your contract, click the Add Contract Terms button on the Contract Terms tab to add contract terms either from a contract terms template or by attaching contract terms in a document.

Selecting a Contract Terms Template

To add contract terms from a contract terms template, select Structured Terms as the Contract Source and select the template.

Attaching Contract Terms in a Document

If you want to attach the contract terms in a document, select Attached Document as the Contract Source and attach the document. If you attach the contract terms in a document, then you must continue to author outside the application.

Note

Specifying that the contract source is an attached file and uploading a file is not the same thing as attaching a file to the contract on the Documents tab. The latter only attaches a supporting document.

Authoring with Contract Terms Templates: Explained

Contract Terms Library administrators set up contract terms templates to apply contract terms and conditions based on the type of contract you are authoring. Depending on the setup, the application can automatically apply the contract terms and conditions from a template or let you select which contract terms template to apply manually.

A contract terms template you apply on a contract can:

When a contract terms template is applied on a purchasing or a sourcing document rather than on an enterprise contract, then the template can also include contract terms deliverables for tracking deliverables such as performance reviews, references, and proof of insurance.

The following figure provides an example of how you work with a contract terms template:

  1. The application applies the terms and conditions from the contract terms template either automatically or when you select the template manually.

  2. The Contract Terms tab now contains the contract terms and conditions from the template. The sections and clauses are numbered according to the template's numbering scheme. In purchasing documents, an additional tab can list contract terms deliverables (shown in a shaded box).

  3. You can edit the clauses on the Contract Terms tab using the outline on the left.

  4. If the template requires you to run Contract Expert, you may be asked to answer questions and enter values for contract variables. Depending on your entries, Contract Expert may insert additional clauses that were not present in the template itself.

This figure shows the role of a contract
terms template during contract authoring.

Adding and Editing Sections and Clauses

The contract terms template can include all the boilerplate clauses required for a contract such as a warranty, for example, or just a few of the common clauses such as the governing jurisdiction. These are inserted automatically into the contract terms when the template is applied.

Depending on your privileges, you can add additional standard clauses, substitute an alternate clause for an existing clause, edit standard clauses or add new nonstandard clauses that are specific to the contract.

Any change you make to the clauses applied from the template will be recorded as a clause deviation in the contract deviations report you run before you submit the contract for approval.

Running Contract Expert

Some contract terms templates require you to run the Contract Expert feature to determine if additional clauses must be added. You can tell if you must run Contract Expert when the Clauses tab includes the Contract Expert Last Run indicator above the contract terms preview region. When you run Contract Expert by selecting the Run Contract Expert action, Contract Expert may ask you to enter values for contract variables and to answer questions. If you do not run Contract Expert on a contract that requires it, then you receive an warning message during contract validation.

Adding Contract Terms Deliverables for Purchasing and Sourcing Documents

If the contract terms template includes contact terms deliverables, these deliverables are visible only when the template is applied to a purchasing document. You can use these contract terms deliverables in a purchasing document for the submission and tracking of contractual deliverables such as reports and inspections. These deliverables can be updated both by the purchasers within your organization and by the vendors using their supplier portal. The contractual deliverables are listed in a clause in the contract terms.

Changing the Source of Contract Terms : Points to Consider

Depending on the contract, its status, and your privileges, you may be able to change the contract source by selecting the Change Contract Source action on the Contract Terms tab, for instance replacing the current contract terms template with another.

You can use this action to:

Switching Templates

Switching templates by applying a different template completely removes all of the contract terms applied from the old template, including any that you may have edited into nonstandard clauses. The application moves any standard clauses you added or any nonstandard clauses you created from scratch to the Unassigned section. The Unassigned section, which is created automatically, does not print in contracts. You must move any clauses from the Unassigned section to other sections if you want them to be part of the new contract terms.

Note

If you are switching templates in Oracle Fusion Purchasing or Oracle Fusion Sourcing contracts, then you can retain contract terms deliverables by selecting the Retain All Deliverables option.

Replacing the Contract Terms in the Application with an Attached File

You may need to attach the contract terms to replace the contract terms in the application, if you are editing the contract terms in Microsoft Word and the there are too many changes to import back into the application successfully, for instance. When you change the contract terms source from a contract terms template to an attached file, the application removes all of the contract terms and contract documents. You have the option of selecting the Retain Structured Terms for Reference option to include the contract terms in the contract deviations report, contract terms validation, and clause analysis.

Replacing One Attached File with Another

When you change the contract terms source from one file to another, the application deletes the old file if the file name is the same. If the new file name is different, then the application preserves the file you are replacing in contract Documents.

Note

The old file is not preserved in Oracle Fusion Sourcing because negotiation documents do not include the Documents tab.

Replacing an Attached File with a Contract Terms Template

When you replace an attached contract terms file with the terms from a contract terms template, the application retains the file for reference on the Documents tab except in Oracle Fusion Sourcing where the file is deleted.

Contract Terms Authoring Actions: Explained

This topic lists and briefly describes the actions for authoring contract terms.

The actions in the Actions menu are divided into four groups. There are actions for:

Note

The Actions menu appears only after you add contract terms. Which actions are available on a contract depends on your implementation, the contract type, and the contract life cycle.

Actions for Authoring Within the Application

The following actions are related to authoring within the application:


Action

Description

Edit Variable Values

Select the Edit Variable Values action to enter any missing variable values. The Clauses tab displays the number of missing values in the Pending Variables indicator. You must enter any missing values before you submit the contract for approval. Missing variable values generate warnings during contract validation.

Run Contract Expert

Some contract terms templates require you to run the Contract Expert feature to determine if additional clauses must be added. You can tell if you must run Contract Expert when the Clauses tab includes the Contract Expert Last Run indicator above the contract terms preview region. When you run Contract Expert by selecting the Run Contract Expert action, Contract Expert may ask you to enter values for contract variables and to answer questions. If you do not run Contract Expert on a contract that requires it, then you receive an warning message during contract validation.

Actions for Authoring Contract Terms Using Word 2007

The following table lists the actions you can use for editing the contract terms outside the application using Word 2007.


Action

Description

Download Contract

Use the Download Contract action to export the contract terms authored in the application to an XML file you can edit in Word 2007.

Upload Contract

Use the Upload Contract action to import the edits you made in Word 2007. You can only upload a file that was originally downloaded from the application.

Lock Contract Terms

Use the Lock Contract Terms action to prevent anyone from editing the contract terms in the application while you are editing the contract terms offline in Word.

Actions for Checking Your Work

The following table lists the actions for checking the contract terms meet your organization's standards.


Action

Description

Review Contract Deviations

Select the Review Contract Deviations action to generate a report that lists differences between the contract terms in the contract and the contract terms in the contract terms template. The deviations report lists:

  • Standard clauses you added, edited, or deleted

  • Alternate clauses you selected to replace the standard clauses

  • Nonstandard clauses you created for this contract

  • Missing clauses recommended by Contract Expert

  • Outdated clause versions

  • Policy deviations

Check for Clause Updates

Select the Check for Clause Updates action to check if a more recent clause version is available in the Contract Terms Library.

Validate Contract Terms

Select the Validate Contract Terms action to determine if the contract terms are ready to be submitted for approval. Validation can generate both errors and warnings. You must correct the errors. Correcting the warnings is optional.

The application automatically performs the same contract terms validation whenever you submit the contract for approval.

Actions for Starting Over

The following table lists the actions you can use to start over.


Action

Description

Change Contract Source

Select the Change Contract Source action to change the source of the contract terms from one template to another, from a template to an attachment, or from an attachment to a template.

If you change templates, the application removes all sections and clauses added by the original template, including any you have edited. Only new clauses you added are kept under the Unassigned section heading.

Remove Contract Terms

Select the Remove Contract Terms action to remove all contract terms from the contract. Removing contract terms removes all contract terms documents.

Creating Nonstandard Clauses During Authoring: Points to Consider

If you do not find the standard clause you need in the Contract Terms Library, then you can create a nonstandard clause either by adding a similar standard clause and editing it or by creating an entirely new nonstandard clause.

Creating a Nonstandard Clause by Editing a Standard Clause

Adding a similar standard clause and editing it makes it possible at any time to revert back to the most recent version of the original standard clause and to compare the nonstandard clause text with the text of the most recent version of that standard clause.

Creating a New Nonstandard Clause

Creating an entirely new nonstandard clause does not permit you to revert to a similar standard clause or compare the text. Both types of nonstandard clauses are listed as deviations in the Contract Deviations report submitted along with the contract for approval.

Contract Variables: Explained

Contract variables represent information that varies from contract to contract. They make it possible for you to change parameters, such as payment terms and price, in clauses without modifying the clause text. You must supply the value for all the variables. If you do not, the application generates a warning during contract validation and represents the missing information as dashes in the printed contract.

Contract variables fall into two types:

User Variables

User variables represent information in individual clauses. For example a jurisdiction clause may contain a variable that specifies the county and state . User variables have the following properties:

System Variables

System variables are already defined in the application and are available for use in the clause text. The application obtains the value of the system variables from the contract header or lines. System variables have the following properties:

Reviewing Contract Deviations: How It Works

Select the Review Contract Deviations or the View Contract Deviations action to check how well your contract conforms to company standards by generating a report of contract deviations. The reports highlights any differences between the contract terms in the contract and those in the associated contract terms template and warns you of any deviations from company policies. A copy of the report can be automatically attached to the contract approval notification sent to contract approvers.

The Review Contract Deviations action makes it possible for you to enter a justification for any deviations in the report and make the report available for review by the contract's approvers. This action is available while the contract is in a status that is open to editing, such as the draft status.

While the contract is closed for editing, for example when the contract was submitted for approval or was rejected, you can only view the report by selecting the View Contract Deviations action.

The following figure illustrates how the contract deviations report is generated and used:

  1. When you select the Review Contract Deviations action, the application checks for and lists any changes to the clauses applied from the contract terms template.

  2. The application also checks and records any deviations from company policies by evaluating Contract Expert rules which apply to the contract terms template you are using.

  3. If you want to submit the report for review by contract approvers, then you must select the Generate for Approval option. You can enter an explanation for the approvers and other comments in the Approval Abstract field.

  4. If you selected the Generate for Approval option and submit the contract for approval, then the application automatically regenerates the report to ensure that it contains the latest information and attaches it as a PDF to the notification sent to the approvers.

This figure shows the process for generating
the contract deviations report.

Clause Deviations

The application checks for invalid, nonstandard, and missing clauses by comparing the contract terms in the contract with those in the latest version of the contract terms template applied to the contract.

Policy Deviations

Policy deviation checks are based on the values of variables in the contract and the answers you give to any questions presented during authoring. For example, if you specified payment terms of 30 days for a big contract, but company policy only permits 20 days on such contracts, this deviation is recorded in the report. Policy deviations depend on Contract Expert rules set up by the Contract Terms Library administrator for a particular contract terms template.

Running Contract Expert During Authoring: How It Works

If a Contract Expert-enabled contract terms template is applied to your contract, then you must run Contract Expert to determine if the contract deviates from company policies or if any additional clauses are required. When you run Contract Expert, you may be asked to enter values for contract variables or to answer questions . Based on your responses, Contract Expert may suggest additional clauses for insertion into the contract terms. If you fail to run Contract Expert on a contract which requires it, then you will receive a warning when you attempt to submit the contract for approval or when you download the contract for editing in Word 2007 or later versions. You can run Contract Expert at that time.

The following figure illustrates what happens when you run Contract Expert by selecting the Run Contract Expert action from the Actions menu or by clicking the icon at the top of the preview section on the Clauses tab. The application:

  1. Prompts you to respond to questions and to specify values for variables. In some cases, additional questions may appear depending on the responses that you provide to previous questions. If you already ran Contract Expert on the contract before, the application remembers the values you entered previously.

  2. Evaluates your entries to determine if the contract requires additional clauses and displays them for your review.

  3. Inserts the selected clauses into the contract terms.

  4. On subsequent runs, Contract Expert removes any clauses it inserted previously.

This figure illustrates the running
of Contract Expert during contract authoring.

Removes Any Clauses It Inserted Previously

If this is not the first time you are running Contract Expert, then the feature removes the clauses that it inserted previously, even if you moved them to other sections. Contract Expert does not remove any of the clauses you turned into nonstandard clauses by editing them.

Prompts You to Enter Additional Information

Contract Expert starts evaluating any business rules entered by the Contract Terms Library administrator for the contract terms template being used on your contract. If the rules require your entry, then Contract Expert displays pages where you enter variable values and answer questions. Answers to questions can trigger follow-up questions. In this figure, the answer to Question 1 triggered the follow-up Question 2.

Evaluates Your Entries and Displays Any Additional Clauses for Your Review

Contract Expert completes evaluating the business rules based on any additional information you provided and displays the recommended clauses for your review before inserting them into the contract terms.

You can reject a recommended clause by deselecting the Insert Into Document option on the Review Suggested Clauses page provided you have sufficient privileges. Your rejection is listed as a warning when you review contract deviations. If you do not have the required privileges, this option cannot be deselected.

Inserts Additional Clauses Into the Contract

Contract Expert inserts the additional clauses into the contract.

Frequently Asked Questions for Contract Terms Authoring

Why can't I see my edits on the Clauses tab?

The contract terms preview in the right pane of the Clauses tab is not automatically updated as you edit. You must refresh the preview by clicking the Refresh icon to see all of your edits.

Why can't I edit the contract terms?

There are multiple reasons why you may not be able to edit the contract terms on the Clauses tab.

These include:

What are pending variables?

Pending variables are contract terms variables that are missing values. You must enter all of the missing variable values during contract terms authoring before submitting the contract for approval. The Pending Variables indicator on the Clauses tab shows the number of variables with missing values.

You can enter the missing values in one of the following ways:

What's a primary contract document?

A file containing the contract terms and conditions. This file can be generated automatically by the application from the structured terms or attached to the contract by the contract author.

If you are authoring contract terms and conditions in the application using structured terms, then the application automatically creates the primary contract document at the time you submit the contract for approval. If you are attaching contract terms in a separate file, the file itself is the primary contract document.

What's a nonstandard clause?

A clause created during contract terms authoring by editing a standard clause or by creating a new clause that is not in the Contract Terms Library.

What's the clause default section?

The clause default section is the contract terms section where the Contract Expert rules insert the clause.

What's a future-dated clause?

A future-dated clause is a clause in the Contract Terms Library that will be available for use at a future date.

What's the difference between the Clause Title and the Display Title fields?

The clause title you enter in the Clause Title field must be unique in the business unit where you are creating the contract and cannot be changed after you first save the clause.

You can use the Display Title field to substitute a different title in the printed contract. This is useful if you want to create several variations of a clause with the same title, for example. The display title has no uniqueness requirement and can be edited after you save it.

Can I add nonstandard clauses from other contracts?

No, you cannot search for or add nonstandard clauses created in other contracts. You can only search for and add standard clauses in the Contract Terms Library. Any nonstandard clauses you create are restricted to individual contracts.

What am I previewing in a contract terms template preview?

The contract terms template preview displays the contract terms in the template with the numbering scheme that will be used in the printed contract. The preview does not include any contract terms that may be added by the application as the result of your entries of variable values or your answers to questions associated with the template. The preview does not necessarily display the contract terms using the same styles as the printed version because it uses a different layout template.

What clause deviations does the contract deviations report capture?

The application checks for invalid, nonstandard, and missing clauses by comparing the contract terms in the contract with those in the latest version of the contract terms template applied to the contract.

The following table lists the deviations captured in Clause Deviations section of the Contract Deviations report. You can generate the report by selecting the Review Contract Deviations action.


Deviation Category

Description

Added nonstandard clauses

You added nonstandard clauses either by editing a standard clause or by creating a completely new nonstandard clause in the contract.

Missing standard clauses

You removed mandatory or optional clauses that were present in the contract terms template or were recommended by Contract Expert.

Invalid clauses

A clause can become invalid in the Contract Terms Library because:

  • The clause was placed on hold by an administrator.

  • The clause expired.

  • The clause was one of the clauses recommended by Contract Expert, but that recommendation is no longer in effect.

Added standard clauses

You added additional standard clauses or replaced clauses with their alternates.

What clause updates am I checking for ?

The Check for Clause Updates action checks for and displays any new versions that are available for the standard clauses in your contract. You can substitute the new version for the original.

What's the difference between reviewing contract deviations and validating contract terms?

The Contract Deviations report, generated by selecting the Review Contract Deviations or the View Contract Deviations actions, lists all the changes you made to the contract terms applied from the contract terms template and any departures in the contract from company policies. A copy of the report with your comments can be submitted along with the approval notification to approvers.

Contract terms validation, which is performed by selecting the Validate Contract Terms action or automatically whenever you attempt to submit the contract for approval, lists errors that you must fix before you can submit the contract for approval. Fixing warnings on the report is optional.

Contract deviations and validations do overlap. The Contract Deviations report lists invalid clauses that will generate errors when you validate the contract, for example. Examples of invalid clauses include clauses that were placed on hold or have expired. But the validation checks are more comprehensive and include checks for errors in variable definitions, for instance. The following table compares the features of contract deviation and contract terms validation:


Feature

Contract Deviation Report

Contract Terms Validation

Lists changes made to the contract terms applied from a template.

Yes, lists all changes including the addition of clauses or substitution of alternate clauses.

Restricted to warnings for some changes such as the deletion of mandatory clauses.

Lists changes to clauses recommended by the Contract Expert feature.

Yes.

Yes.

Includes a list of deviations from company policies.

Yes.

No.

Lists invalid clauses that will prevent the contract from being submitted for approval.

Yes.

Yes.

Lists variable and other errors that will prevent the contract from being submitted for approval.

No.

Yes.

Can be attached as a PDF report to the approval notification.

Yes.

No.

Makes it possible to add comments for approvers.

Yes.

No.

What's a policy deviation?

The application determines if your contract deviates from company policies by evaluating the variable values in your contract and the answers you give to any questions presented during authoring. For example, a contract may deviate from company policies if payment terms are greater than Net 60 for a contract worth more than $100,000.

Contract Terms Library administrators create and maintain the rules for checking policy compliance using Contract Expert rules. Different rules can apply for each contract terms template.

What happens to the existing primary contract document when I upload a new one?

What happens to the existing primary contract document depends on the name of the new file you are uploading. If the new and existing files have the same name, then the new file overwrites the existing file. If the file names are different, then the existing file is archived as a supporting document which is available in the Documents tab of the contract. The Documents tab is not available in negotiations in Oracle Fusion Sourcing.

What kind of information does the Contract Terms tab or page display during authoring?

Depending on the contract, the Contract Terms tab or page can display very different information.

The following table lists the possibilities:


What's Displayed

What It Means

Clauses tab with structured terms

This can mean:

  • The application automatically applied the contract terms template.

  • A contract author applied the template

Add Contract Terms button only.

This can mean:

  • The application did not automatically apply contract terms from a contract terms template.

  • A contract author removed the contract terms by selecting the Remove Contract Terms action.

Note

The only available action is to add contract terms using the button. No Actions menu is displayed.

Clauses tab displays the name and link to a file.

A contract author attached the contract terms as a file. The contract terms are being authored outside the application.

Clauses tab displays the name and link to the file but also shows the structured contract terms authored in the application.

The contract author attached the contract terms as a file but selected to retain the structured terms for reference. The structured terms are being kept for reference only and may not reflect the contract terms in the file. You cannot edit the structured terms.

What's the difference between validating the contract terms and validating the contract?

Validating the contract terms by selecting the Validate Contract Terms action displays errors and warnings specific to the contract terms and conditions.

Selecting the Validate Contract action displays errors and warnings for the contract header, lines, and other contract attributes in addition to those specific to the contract terms and conditions.

When do I import the nonstandard clause text instead of entering it?

Import clause text from a document created in Word instead of entering the text directly into the application if you want to preserve complex formatting not supported by the application's editor or if using Word is more convenient.

Note the following:

Why am I being asked to enter variable values in the Contract Wizard?

Variables are used to represent information that changes from contract to contract. If the legal language of the contract includes one or more of these variables, then the values you provide will be part of the legal contract terms and conditions. The application also evaluates the variable values you enter to determine if it must insert additional contract terms. In the Contract Wizard, you can review any additional terms the application inserted during contract review.

What variable values can I enter while authoring contract terms?

You can enter values only for variables used within the terms and conditions of your contract. You can select to view only pending variables, those variables with missing values, or view and edit all available variables. The value of other variables, such as the variable representing the customer on the contract, come directly from the contract header and cannot be edited here.

Frequently Asked Questions for Running Contract Expert

Can I reject the clause recommendations made by Contract Expert?

You can reject a clause recommended by Contract Expert by deselecting the Insert Into Document option on the Review Suggested Clauses page provided you have sufficient privileges. Your rejection is listed as a warning when you review contract deviations. If you do not have the required privileges, this option cannot be deselected.

What happens if I do not enter values for all of the variables?

Any variable without a value shows up as an underscore in the printed contract and generates a warning when you validate the contract terms. Those variables that require you to choose a value from a list can also trigger the application to insert additional clauses. Leaving one of these variables without a value can mean your contract does not have all the required clauses.

When must I run Contract Expert?

If you are authoring contract terms in the application and the Clauses tab includes the Contract Expert Last Run indicator, then you must run the Contract Expert feature, either by selecting the Run Contract Expert action from the Actions menu or by selecting the icon next to the indicator. You should run Contract Expert when you first apply the contract terms template and, optionally, before you submit the contract for approval. You may want to run Contract Expert more than once on a contract that is being authored over a long period of time just in case the Contract Terms Library administrator updated the Contract Expert business rules. The indicator on the Clauses tab displays Not Run if you did not run Contract Expert or records the date and time when you last ran Contract Expert on the contract.

Frequently Asked Questions for Authoring Using the Contract Wizard

How can I edit the contract terms in the Contract Wizard?

You cannot edit the contract terms applied from a template in the Contract Wizard itself. You can only change contract terms templates. However, provided you have the correct privileges, you can edit the contract and its contract terms outside the Contract Wizard by selecting the Edit Contract action.

What documents can I upload in the Contract Wizard?

If the party authoring the contract is internal or if the contract terms template is applied on the contract, then you can upload files as a supporting contract documents. You cannot upload a file as the primary contract document in this case. If the party authoring the contract is external, then you can upload a file as the primary contract document in addition to uploading supporting documents.

What's the difference between authoring a contract with and without the Contract Wizard?

Authoring enterprise contracts using the Contract Wizard provides a simple and quick method for creating contracts which you can later edit to add additional details.

When you select the Create Contract in Wizard and Edit Contract in Wizard tasks you:

Use the Create Contract and Edit Contract tasks to create complex contracts or to add those details to contracts created with the wizard. Using these tasks you can:

What's the difference between reviewing and previewing the contract in the Contract Wizard?

The Review Contract page in the Contract Wizard displays the contract terms with basic HTML formatting. It may not include all of the formatting or content of the final contract. Use it to review the content of the contract terms.

The Preview Contract button generates a PDF of the entire contract as it will be submitted for approval and presented to the customer or supplier. The PDF includes all of the formatting and content.

Why am I being asked to answer questions in the Contract Wizard?

The application uses the answers you provide to determine if your contract meets your organization's standards and if must insert additional contract terms. You can review any additional contract terms inserted by the application when you review the contract. This step is equivalent to running the Contract Expert feature when you author contract terms without the Contract Wizard.

Editing Contract Terms Offline in Microsoft Word

Editing Contract Terms Outside the Application in Word 2007: How It Works

You can edit contract terms offline using Microsoft Word 2007 and import the edits back into the application.

The following figure outlines the process:

  1. Download the contract terms as an XML file to your desktop by selecting the Download Contract action in the Contact Terms tab. You can lock the contract terms in the application while you are editing them offline.

  2. Edit the file using Microsoft Word 2007 and accept or reject all changes.

  3. Select the Upload Contract action to upload your changes. Depending on your needs, different options make it possible to update the structured terms in the application with your changes or simply attach them as a file. The different use cases numbered in the figure are discussed in the Uploading Your Edits section.

  4. If you decide to update the structured terms in the application, then you must review and accept the changes.

This diagram outlines the process for
editing contract terms outside the application using Microsoft Word
2007.

Downloading the Contract Terms

Select the Download Contract action to download the contract terms as a Word 2007 XML file. When downloading, you can prevent others from editing the structured terms while you are working outside the application by selecting the Lock Contract Terms Until Upload option.

Editing Contract Terms Outside the Application

If you want to automatically update the contract terms in the application with the edits you make in the Word file, then you must:

Tip

There are no restrictions if you want to attach the edited file without updating the structured terms in the application.

Uploading Your Edits

After selecting the Upload Contract action to upload your edits, you can either update the contract terms in the application with your edits or attach the edited file.

The different use cases depend on your selection of the following three options:


Use Case

Use Case Number

Contract Source Selection

Update Contract Terms Automatically

Retain Structured Terms for Reporting

Consequences

You want to import the edits from the file into the application.

1

Structured Terms

Selected

Not applicable for this use case.

  • The contract terms in the application are updated with the edits from the Word document.

  • The application remains the source of the contract terms.

  • The file with your edits is uploaded as a supporting document.

The edits in the Word file are so extensive that importing them into the application is impractical.

The contract terms in the file are so different, that running the contract deviations report against the terms in the application would be misleading.

2

Attached Document

Deselected

Deselected

  • The application is not updated with changes.

  • The Word file becomes the primary contract document.

  • The structured terms in the application are not retained for reports.

You do not want to import the edits into the application, but you want to retain the contract terms in the application for reporting.

3

Attached Document

Deselected

Selected

  • The application is not updated with your changes.

  • The Word file becomes the primary contract document.

  • The structured terms are retained for reporting.

You want to specify the attached file as the primary contract document, but want to import the changes into the application for more accurate reporting.

4

Attached Document

Selected

Selected

  • The application is updated with your changes.

  • The Word file becomes the primary contract document.

  • The structured terms are used for reporting.

Automatically Updating the Contract Terms in the Application

If you chose to update the contract terms in the application automatically, the application compares the contract terms in the file with those in the application and displays the changes in the Review Changes page.

Note

Before you upload, you must accept all tracked changes in the Word file. If the Accept and Reject buttons are not enabled on the Review tab, you can enable them by selecting Protect Document, Restrict Formatting and Editing and clicking Stop Protection.

The application considers some but not all edits as changes for importing. Examples of changes that do get imported include:

The application does not import some edits such as moving clauses or sections within the contract terms. Font changes are only imported if they are accompanied with another edit. For example, the application will ignore clause text you placed in italics if that is the only edit you made. Nor does the application import any edits you may make to the clause or section numbers. It retains the numbering in the structured terms.

Also not imported are any changes in variable values you made in the Word document. You must edit the variable values in the application after your upload.

You can use the Review Changes page to either accept or reject all of the changes and to merge any clauses that were split accidentally. If you want to reject individual changes, then you must cancel the upload, make additional edits to the Word document, and upload again.

The application retains the file you uploaded as a supporting document. If the file name is the same as the previous version you uploaded, then the previous version is overwritten.

Managing Contract Terms Deliverables

Contract Terms Deliverables: Explained

Contract terms deliverables establish and track both contractual and noncontractual commitments that must be fulfilled as part of negotiations and contractual agreements between businesses and their partners. These deliverables can be used only in procurement contracts and in negotiations. They cannot be used in enterprise contracts.

This topic provides an overview of:

Using Contract Terms Deliverables

You can use contract terms deliverables:

Creating and Managing Contract Terms Deliverables

You create and manage the deliverables in two separate interfaces. You create the deliverables while the contract is in negotiations. You manage the deliverables while the contract is active and in the process of being executed. Here is how it works:

  1. You create the deliverable as part of a contract terms template or in an individual contract entering the responsible party, the deliverable deadlines, and what notifications you need.

  2. If deliverables are present in a contract terms template you apply to a contract, then the deliverables get copied to the contract automatically. The type of deliverables that are applied automatically can vary based on the document type.

  3. The application creates deliverable instances with the calculated deadlines based on your setups at the time the contract becomes active. For instance, if you created a deliverable that calls for the supplier to submit a report every week after the contract is signed, then the application creates a separate instance of the deliverable for each week based on the date the contract was signed.

  4. You and the suppliers use the Manage Deliverables page to access and update each deliverable instance. In the above example, each week the supplier updates the deliverable instance that is due that week and attaches any collateral. Both internal employees and suppliers logging into their supplier portals use the same interface to communicate the deliverable progress and to attach required documents.

  5. Based on your setups, the parties are automatically notified when the deliverable is due or overdue, or when one of the parties changes its status (dashed lines).

  6. The contractual deliverables you set up are listed in the printed contract terms when you add the deliverable variable to a clause.

This diagram illustrates the two different
interfaces you use to create and manage contract terms deliverables.

One-Time and Repeating Deliverables

You can create both one-time and repeating deliverables.

A one-time deliverable tracks the performance and deadlines for an individual required action that must be performed by one of the parties in the contract.

A repeating deliverable tracks a deliverable that must be performed periodically, for instance a progress report that must be submitted every week after the agreement is signed.

The following diagram uses an example to illustrate the two variable types:

After the contract is signed, the application automatically creates the instances of the two deliverables which can be viewed and updated both by the internal party and the supplier using the Manage Contract Terms Deliverables task. The due dates for each deliverable in this example are based on the date the contract was signed.

Note

Note that the name of each deliverable instance for a repeating deliverable is the same. The only difference is the due date.

The supplier attaches the report file to the appropriate instance of the deliverable and changes its status to complete to indicate that it has been fulfilled.

This diagram illustrates the example
of one-time and repeating deliverables.

Where You Can Create and Use Contract Terms Deliverables

You can create contract terms deliverables both in buy-intent contract terms templates and in individual Oracle Fusion Purchasing and Oracle Fusion Sourcing contracts.

For purchasing, you can create and use deliverables on documents which include:

For sourcing, the documents include:

Contract Terms Deliverable Types

Deliverable types restrict where a deliverable is available and where it can be printed. There are three deliverable types:


Fulfillment Type

Where Available

Description

Where It Prints

Contractual Deliverables

Purchasing and sourcing

Deliverables that must be fulfilled as part of the contract.

Prints in all documents:

  • As part of the Contract Terms Template preview

  • Procurement contracts

  • Sourcing documents

Negotiation Deliverables

Sourcing only

Deliverables that are a part of a negotiation document but are not part of the final contract.

Prints as part of:

  • As part of the Contract Terms Template preview

  • Sourcing documents

Internal Purchasing Deliverables

Purchasing only

Purchasing deliverables that are used to track internal schedules and commitments.

Not printed as part of the contract terms.

Note

If you create a deliverable as part of a contract terms template and that deliverable is of a type that is not compatible with the contract where the template is applied, then the deliverable does not get created in that contract. For instance, a negotiation deliverable in a template is dropped when that template is applied to a purchase order but added when that same template is used for an RFQ.

Fixed and Relative Due Dates

You can specify a deliverable to be due on a fixed date, such as the first of the month, or relative to a contract event, such as one week after the contract is signed.

The available events include:

The available contract events differ depending on where you create the deliverable and the deliverable type. For instance, for contractual deliverables you create in a contract terms templates, you can base the due dates on: Contract Canceled, Contract Closed, Contract Signed, Contract Start Date, and Contract End Date. Negotiation deliverables can be based on: Negotiation Closed, Negotiation Opened, and Response Received.

Deliverables Notifications

You can notify interested parties using Oracle BPEL Process Manager via e-mail, voice message, instant messaging (IM), or short message service (SMS).

You can send automatic notifications:

Who receives the notification depends on a combination of the notification type and the party who is responsible for the deliverable as listed in the following table. The requester is an internal party. The external contact is a supplier contact.


Notification Type

Responsible Party

Recipients

Prior to due date

Internal

Internal Contact

Prior to due date

External

External Contact

Overdue

Internal

Requester, Internal Contact

Overdue

External

Requester, Internal Contact, External Contact

Status Change

Internal

Requester, Internal Contact

Status Change

External

Requester, Internal Contact, External Contact

Escalation

Internal and External

Requester, Internal Contact, Escalation Contact

Managing Contract Terms Deliverables: How It Works for Suppliers

Use the Manage Contract Terms Deliverables task to communicate the status of deliverables to the purchasing department and to submit any required documents.

Contract terms deliverables are created by the buyer as part of the contract negotiations and are listed in the contract terms. Each deliverable includes information about the due date and can automatically notify you before it is due.

If a particular deliverable is due periodically, then the application creates separate instances for each of the due dates. Such repeating deliverables share the same name but have different due dates. For example, a safety report that is due every month after the contract is signed, results in multiple instances of the same deliverable each with the appropriate due date.

The following diagram outlines how you use contract terms deliverables to communicate with the buyer:

  1. Before the due date or when you receive a notification, you log onto the supplier portal. You can edit any deliverable in the Open or Rejected status.

  2. You can add a comment to the deliverable and attach any required files and submit the deliverable for buyer review.

  3. They buyer reviews your submission and indicates if the deliverable is accepted.

  4. If the buyer rejected the deliverable and it is in the Rejected status, then you can edit it and submit it for approval again.

  5. If the buyer rejects the deliverable and it is past due, the buyer changes the status to Failed to Perform. You cannot edit deliverables with this status.

This diagram outlines the role of buyers
and supplier for managing contract terms deliverables.

Buyer Role in Terms Deliverable Management

The buyer reviews the submission:

Automatic Notifications

If you, the supplier, are the responsible party for the deliverable, then the buyer can set up notifications that inform you automatically:

Frequently Asked Questions for Contract Terms Deliverables

What's the difference between contract terms deliverables and contract deliverables?

Contract terms deliverables establish and track both contractual and noncontractual commitments that must be fulfilled as part of negotiations and contractual agreements between businesses and their partners. These deliverables can be used only in procurement contracts and in negotiations. They cannot be used in enterprise contracts.

Contract deliverables are contract fulfillment lines that track contractual and noncontractual commitments, but in procurement enterprise contracts. In addition, you can use contract fulfillment to initiate and monitor purchasing activity in integrated procurement applications. For example, you can use a contract fulfillment to create a purchase order in Oracle Fusion Purchasing for items in a contract line and then monitor the purchasing activity on that purchase order as it is being executed.

How can I change the due dates, notifications, and other contract terms deliverable details?

You cannot change the due dates or other information while editing a contract terms deliverable using the Manage Contract Terms Deliverables task because the contract was already approved. Only buyers can make changes and only when the contract is being amended.

What does it mean to change the printing sequence for contract terms deliverables?

Contract terms deliverables can be listed by title in a clause in your terms and conditions. You can change the sequence in which the titles appear on this list by modifying the print sequence.