This chapter covers the following topics:
One of the primary capabilities of Oracle Project Contracts is the ability to track funding at any level of the contract. A contract can be funded from multiple parties in multiple currencies. This chapter describes funding and billing considerations in project hierarchy setup, creation and update of PA Agreements from the Funding Workbench of Oracle Project Contracts, and creation and update of PA Billing Events from the Deliverable-Based Billing Event window of Oracle Project Contracts.
This chapter is based on the integration of Oracle Project Contracts and Oracle Projects. You do not need to implement Oracle Projects in order to use the funding capabilities in Oracle Project Contracts.
See Oracle Project Billing User Guide for additional information.
You can assign a master project at the contract header level and subprojects or master project top tasks at the contract line or subline level. You can assign one or more projects as subprojects at any level of the master project Work Breakdown Structure (WBS) at the top, middle, or lowest level tasks. You can assign a project of any type class (contract, indirect, or capital) to the hierarchy, but you must assign a project of contract type class at the level for which you want to do funding and billing.
If the project intent is Sell, you should consider the billing structure of the contract when setting up the WBS and project hierarchy and assigning projects to the contract. A contract may have:
A single billing method for the entire contract.
You can assign one project for the entire contract, depending on the complexity of the cost collection desired.
Multiple contract lines with different billing methods assigned at the contract line level.
You can assign a separate billable project to each line with its own billing method.
Fixed price billing method with progress payments.
You can collect progress payment cost and perform progress billing at the master project level while billing delivery-based events on separate subprojects.
Note: Currently Oracle Projects does not rollup subproject cost at the master project level.
If you want to create a Funding Source for your contract, you must assign a Fund By party on the Parties and Contacts tab in the Authoring Workbench. The Fund By party must be one of the customers assigned to the project in the hierarchy. You can see which customers have been assigned to the project in the list of values on the contract lines project field.
You can fund an indirect project for a Buy contract, such as a subcontract.
You can assign multiple Fund By parties if more than one customer provides funding for the contract. You must set up a separate Funding Source entry for each funding customer who provides funding.
Each funding source is in a specific currency, which can be different from the contract currency. If a Fund By party is providing funding in multiple currencies, you must create a different funding source with the same funding party for each currency.
You can set up a Funding Pool with one or more parties as the funding source. The Funding Pool can fund one or more contracts in a currency that is different from the contract currencies. The funding pool currency must match the funding source currency of those contracts.
You can create a new project agreement from the Funding Workbench. In order to create a project agreement, the following information is required:
Receivables Payment Terms: You must set up Receivables Payment Terms on the Terms and Conditions tab of the Authoring Workbench.
Agreement Number: You must enter the desired agreement number that will be used to create the project agreement.
You can assign an agreement owning organization on the Funding Workbench. You can choose any project owning organization in the project owning organization hierarchy assigned to the operating unit as the organization that owns the agreement.
You can enter separate hard limit amounts for revenue and invoices. Entering a hard limit amount on the Funding Workbench enables the hard limit check boxes in the Projects Agreements window. A revenue hard limit prevents revenue accrual above the amount allocated to a project or top task. An invoice hard limit prevents invoice generation above the amount allocated to a project or top task.
Oracle Project Contracts by default creates one agreement for each funding source. If you have implemented the Multi-Organization feature and the desired funding source has been allocated to projects in multiple operating units, Oracle Project Contracts creates one agreement in each operating unit that funding has been allocated in.
Note: Once you have created project agreements for a funding source, you are not allowed to change the project and task information on its allocations. You can still modify the allocated amounts, effective periods, and other reference information, including descriptive flexfield information.
If you are already using Oracle Projects prior to implementing Oracle Project Contracts, you may already have defined project agreements for your existing contracts. Oracle Project Contracts provides a simple-to-use Funding Wizard to help you convert these pre-existing agreements into contract funding sources.
The Funding Wizard is invoked automatically when you wish to create a new funding source. If you do not have existing project agreements to convert, you can disable the Funding Wizard by clearing the Show Contract Funding Wizard check box in the Funding Wizard or setting the profile option OKE: Show Contract Funding Wizard to No.
You have the option to convert a project agreement into a different funding source currency. You will need to provide the necessary currency conversion information between the functional currency and the funding source currency.
Oracle Projects does not allow maintenance of agreements that are created from the Funding Workbench or have been converted to contract funding sources. You can update the project agreement from the Funding Workbench before or after it has been baselined. If you make changes before baselining the revenue budget, the original project allocation line will be updated. If you make changes after baselining, a new project allocation line will be created on the project agreement for the difference between the baselined amount and the new funding allocation amount.
You can create a revenue budget, funding source allocation and project agreement, and perform billing at either the project or the top task level. After you have created an allocation line at either level, you cannot change to another level. For example, if you have created a funding allocation for a top task, you cannot create another funding allocation for the same project without entering a top task.
You can automatically create and baseline an Approved Revenue Budget for a project by checking the Baseline Funding without Budget check box in the Project Funding Inquiry window.
If funding for the project is at the project level, the budget uses a system-defined budget entry method that budgets at the project level and does not use a resource list.
If funding for the project is at the project level, the budget uses a system-defined budget entry method that budgets at the project level and does not use a resource list.
You can create agreements in currencies other than the functional currency if you select the Enable Multi Currency Billing check box in the Billing tabbed region of the Oracle Projects System Implementation Options window and in the Billing tabbed region of the Currencies window accessed by the Project Options window. You do not have to enter currency conversion attributes on the Funding Workbench allocation lines if the Multi Currency Billing check boxes described above are selected. The funding currency code is appended to the agreement number when the agreement is created in Oracle Projects.
Note: The funding currency code is appended to all agreement numbers initiated from the Project Contracts Funding Workbench, even if the funding currency is the same as the functional currency. For example, if the agreement number you enter on the Funding Workbench is 13579 and the contract is funded in US dollars, you would query for 13579-USD when you search for the agreement in Oracle Projects.
Select the Allow Funding Across Operating Units check box in the Billing tabbed region of the Oracle Projects System Implementation Options window to create agreements in the funding currency for projects defined in other operating units with different functional currencies. The funding currency code is appended to the agreement number in the project's operating unit.
In the Billing tabbed region of the Currencies window accessed by the Project Options window, you can define currency conversion attributes for conversion of:
Funding currency to project functional currency
Funding currency to project currency (if different from project functional currency)
Billing transaction currency for expenditure items and events to funding currency
If you enable the funding currency as the invoice processing currency, you can fund the project in only one currency.
Oracle Project Contracts maintains incremental funding history every time you version a contract. You can create a new version by using the change management workflow-driven status changes or by selecting Create New Version from the Action button in the Contract Organizer.
Note: You are not allowed to change contract, contract line, or project and task information on a funding allocation once a new contract version has been created since the creation of the funding allocation. This is to ensure the integrity of the funding history. However, you can still modify the allocated amounts, effective periods, and other reference information, including descriptive flexfield information.
You can create a deliverable-based billing event from the Project Contracts Deliverable-Based Billing window. In order to create a billing event, the following conditions must be met:
Contract line has a status that is eligible for Invoicing
Contract line is billable
Contract line has been definitized or billing is allowed without definitization
Deliverable is ready to be billed
Using the Deliverable-Based Billing window, you can select any deliverables from a contract that meet the above criteria. After you have provided the desired information, you can select Initiate Billing to invoke the Deliverable-Based Billing workflow process.
By default, Oracle Project Contracts tries to create a manual project billing/revenue event. If you are using the default process, you need to provide the following information before initiating the billing process:
A billing project with a type class of Contract and has baselined funding (baselined approved revenue budget for project or project task matches the amount of funding allocation on the project agreement)
A billable task if task level funding/billing is required based on the project type class
An event type with Manual event type class
Event date
Billing organization
Billing amount
If you are replacing the default process to integrate with another billing system, you may need to provide different information in order to properly initiate the process.
You can re-initiate the billing process and update the billing event in Oracle Projects as long as the event has not been processed (invoiced or revenue distributed). If a billing event has been created for a deliverable, the event number will be displayed when you select the deliverable again from the Deliverable-Based Billing window. Once the billing event has been processed, you can no longer update it.
You can create multiple billing events for a single deliverable line in order to bill partial shipments, freight charges, and prepayments. You can change the original quantity on the Deliverable-Based Billing window if the entire quantity has not been shipped and then create a new line for the remaining quantity when it is shipped. You can delete the item number and item description and enter a new description such as freight or prepayment and change the quantity and unit price in order to bill additional amounts related to the deliverable line.
You can create billing events in currencies other than the functional currency. If the billing project has the Enable Multi Currency Billing check box selected in the Billing tabbed region of the Currencies window accessed by the Project Options window, you can initiate billing in any currency without entering conversion information on the Deliverable-Based Billing window. Oracle Projects allows you to define currency conversion attributes for converting revenue and invoicing amounts to the project currency, project functional currency, and funding currency.
Customizing Workflows, Oracle Project Contracts User Guide