PeopleSoft Enterprise Contracts for Government Contracting 9.1 PeopleBook

Preparing to Implement PeopleSoft Contracts for Government Contracting

This chapter provides an overview of PeopleSoft Contracts for Government Contracting implementation and discusses how to:

Create and administer government contracts.
Map enterprise data flow.
Identify the PeopleSoft Contracts for Government Contracting implementation steps.

Understanding PeopleSoft Contracts for Government Contracting Implementation

PeopleSoft Contracts delivers functionality that is designed to meet the specific needs of U.S. government contractors. To activate the features and functions associated with government contracting, you must define a contract and assign a contract classification of Government to it. However, before you can define a government contract, you must first set up the underlying infrastructure of the PeopleSoft Contracts system. This includes defining PeopleSoft Contracts business units, setting up core control tables, setting up billing and revenue tables, and so on. The government contracting features rely on the features and functions of PeopleSoft Contracts as the basis for its functionality.

Because the government contracting features are built on top of the PeopleSoft Contracts features and functions, by setting up the PeopleSoft Contracts application infrastructure, you will not only have the features and functions of government contracts available to you, but also many of the features and functions of PeopleSoft Contracts. This enables you to create and manage both government and non-government contract classifications.

During implementation, you should consider which features meet the needs of your particular organization from both a government contracts and non-government contracts perspective, and then set up the PeopleSoft Contracts system's business structure accordingly. After you have set up the core requirements for the PeopleSoft Contracts application, you must determine the best way to map your new system to your organization's existing business infrastructure, practices, and procedures.

Creating and Administering Government Contracts

The steps for creating and administering a contract are essentially the same whether you are creating a contract for non-government use, or one that is funded and managed according to U.S. government rules and regulations. To create and administer a government contract, complete these high-level steps:

Create a new contract with a contract classification of Government, and enter the overall contract terms and conditions.

Selecting the contract classification of Government is required to activate the government contract specific fields and attributes on the Contract Entry pages.
Select the products and services that you will provide using Product identifiers.

The products selected are added to the contract and represent the amount-based and rate-based contract lines, which you use to calculate contract amounts and manage the financial terms and conditions of the contract.
Define the contract terms for the rate-based contract lines.

Enter the limit details, period of performance data, and in the case of cost plus contract lines, fee calculation and processing details.
Associate PeopleSoft Project Costing project identifiers, activity identifiers, and in the case of rate-based contract lines, pricing rates to contract lines.

To track and manage project transactions associated with rate-based contract lines, link at least one project and activity set to the contract line.

Note. It is recommended that you consider structuring your contracts and projects such that a project is associated with only a single contract, to avoid potential reconciliation issues if the same project identifier is used to identify withholding and fee rows for multiple contracts.
Associate a rate set, rate plan, or contract specific rate set or rate plan to the rate-based contract lines to calculate the associated incurred and estimated costs for a contract line, project, and activity.

The system uses the rates, project, and activity data to price cost transactions and apply any applicable limits or withholding parameters to determine how much of the costs or revenue should be passed to PeopleSoft Billing or PeopleSoft General Ledger, respectively.

After a project and activity combination is assigned to a rate-based contract line, you cannot assign that same project and activity combination to any other rate-based contract line at the same time.
Verify accounting distributions for the contract lines.

Each contract line is associated with its own set of accounting distributions. Rate-based contract lines retrieve their accounting distributions from accounting rules defined in PeopleSoft Project Costing.
Allocate the contract fixed price amount across amount-based contract lines.

Amount allocation is not required for rate-based contract lines and rate-based contract lines assigned to fee types (cost-plus) whose awarded amounts, costs, and fees are summarized from the contract line level and appear on the contract header.
Associate each contract line with a billing plan defined in PeopleSoft Contracts.

Define, administer, and maintain billing schedules and billing rules for the products and services that you provide under the contract. Billing plans are required to bill for the contract line.

You can predefine templates and associate them with a product ID to have the system automatically create billing plans and associate them to contract lines.
Associate each contract line with a revenue plan defined in PeopleSoft Contracts.

For amount-based contract lines, either PeopleSoft Contracts or PeopleSoft Billing can manage revenue. For rate-based contract lines and rate-based contract lines assigned to fee types (cost-plus), PeopleSoft Contracts must manage revenue.

When PeopleSoft Contracts manages revenue, you associate each contract line with a defined revenue plan. Revenue plans enable you to define, administer, and maintain revenue schedules for the products and services that you manage under the contract.

Selecting PeopleSoft Contracts as your revenue manager provides you with a high degree of control over the revenue recognition process. Revenue plans are required to generate revenue for a contract line.

You can predefine templates and associate them with a product ID to have the system automatically create revenue plans and associate them with contract lines.
Manage milestones.

Milestones are events in the life of the contract and can be used to control the timing of billing and revenue recognition for amount and rate-based contract lines, award, and incentive fees.
Manage billing for each billing plan.
Manage revenue recognition for each revenue plan.
Manage changes to the contract through amendment processing.

Amendment processing enables you to change an active contract while keeping a historical record of the original contract and any prior amendments to that contract.

Mapping Enterprise Data Flow

When implementing PeopleSoft Contracts for Government Contracting, you must determine the flow of data into and out of the application. Mapping which applications integrate with your PeopleSoft Contracts application and examining how to carry out that integration helps you to make important decisions from the start.

The PeopleSoft Contracts application supports creating and managing U.S. government funded contracts. To take advantage of this solution, consider the following:

To take full advantage of all of the government and non-government features and functions delivered with PeopleSoft Contracts, you must install PeopleSoft Project Costing and PeopleSoft Billing.
- In addition to the base features and functions of PeopleSoft Contracts, additional features and functions are now delivered to support the specific requirements associated with government contracts.
- PeopleSoft Project Costing enables you to store and price cost data to generate billing and revenue data rows and to track and analyze the direct and indirect costs associated with your government contract projects.
- PeopleSoft Billing enables you to generate invoices for costs associated with government contracts and sends billed data back to PeopleSoft Contracts and PeopleSoft Project Costing for review and analysis.
What other applications are integrating with your PeopleSoft Contracts application?
Are the other applications that are integrating with PeopleSoft Contracts already implemented?

If not, what is the proposed implementation schedule?
What kind of data are you tracking in your PeopleSoft Contracts system and what is the expected volume?

Identifying the PeopleSoft Contracts for Government Contracting Implementation Steps

During the implementation process, you must examine your business structure and determine how to map your current policies, procedures, and business practices to the PeopleSoft Contracts system for government contracting.

Your implementation may contain several stages. The following table identifies some possible implementation stages for PeopleSoft Contracts for Government Contracting and potential considerations for each stage:

Implementation Stage	Description	Considerations
Planning	During the planning stage, map the new system to your business structure, practices, and procedures.	How does your business operate? How is it divided among company or subsidiary lines? What is the ratio of government funded contracts to non-government funded contracts? What features will you use and how do these features map to the kind of contracts that you perform?
Setting up the business unit and support structure	Establish your business units and supporting control tables used by the system for processing.	How many business units do you need? What kind of product structure do you require? What level of automation do you want for billing and revenue recognition plans? What other applications will you use and in what order will you implement them?
Establishing security	Decide how your internal breakdown of job functions relates to the functionality of PeopleSoft Contracts for Government Contracting.	Do you want to control the security access of your contracts, milestones, contract statuses, limits, fee worksheets, and so on? What users in your company are involved in the government contracting processes?
Data conversion	Convert your government contracts data from your legacy systems into your new PeopleSoft Contracts system.	How much history do you want to retain from your old system? What method will you use to convert data? Will you archive data?
End user training	Before you begin processing and managing your government contracts, billing, and revenue processes, you must train your end users.	What are the roles and level of decentralization for the people that work with your government contracts? When will PeopleSoft Contracts be in production, and when should your employees be fully trained on the new system?