This chapter discusses how to establish PeopleSoft Contracts business units.
To define PeopleSoft Contracts business units, use the Contracts Definition component (BUS_UNIT_TBL_CA).
PeopleSoft defines a business unit as an operational subset of an organization that enables you to plan the organization's operations around the way that you really work.
Before you begin the day-to-day operation of the PeopleSoft Contracts system, you must create a PeopleSoft Contracts business unit—the backbone of the PeopleSoft Contracts system. Each contract you create is assigned a PeopleSoft Contracts business unit, and many contract attributes are automatically populated from the values you define for the business unit.
As you plan the optimal structure for the PeopleSoft Contracts system, keep in mind its position in the PeopleSoft suite of applications. A PeopleSoft Contracts business unit supplies default billing data to one PeopleSoft Billing business unit and accounting information to one PeopleSoft General Ledger business unit (you can override the PeopleSoft Billing business unit for a contract line at the PeopleSoft Contracts contract billing plan level). Therefore, you need to establish PeopleSoft General Ledger and PeopleSoft Billing business units before you establish the PeopleSoft Contracts business units.
See Also
Understanding General Ledger Business Units and Options
Establishing PeopleSoft Billing Business Units
Defining Contracts User Preferences
PeopleTools PeopleBook: PeopleSoft Application Designer Developers Guide, "Planning Records, Control Tables, and TableSets
Establish at least one PeopleSoft General Ledger business unit and one PeopleSoft Billing business unit.
Access the Contracts Definition - BU Definition page (Set Up Financials/Supply Chain, Business Unit Related, Contracts, Contracts Definition, BU Definition).
Business Unit |
When you first add a business unit, you must provide a description and specify a value in the Default SetID field. |
Default SetID |
Enter a new setID or select an existing one. If you are establishing a PeopleSoft Contracts business unit with the same name as one that is already set up in PeopleSoft General Ledger or PeopleSoft Receivables, the description is automatically populated, and this field does not appear. |
Create BU |
Click to create the new business unit. The system automatically creates default relationships between the business unit and the default setID. If you have already set up a PeopleSoft General Ledger or PeopleSoft Receivables business unit with the same name, this button does not appear. |
Integration
Associate each PeopleSoft Contracts business unit with a PeopleSoft General Ledger business unit. PeopleSoft General Ledger business units define the accounting processing for associated PeopleSoft Contracts business units. All contracts created for this PeopleSoft Contracts business unit use this PeopleSoft General Ledger business unit to generate entries that interact with PeopleSoft General Ledger. |
|
Select a default PeopleSoft Order Management business unit for contracts created under this PeopleSoft Contracts business unit. You can only select PeopleSoft Order Management business units that are linked to the same PeopleSoft General Ledger business unit as this PeopleSoft Contracts business unit. |
|
Select a default PeopleSoft Billing business unit for contracts created under this PeopleSoft Contracts business unit. You can only select PeopleSoft Billing business units that are linked to the same PeopleSoft General Ledger business unit as this PeopleSoft Contracts business unit. |
Currency
Currency Code |
Select the currency code that will appear by default as the contract currency on contracts created using this business unit. |
Rate Type |
Select the group of exchange rates used to convert contract currency amounts to the base currency of the PeopleSoft General Ledger system. You set up rate types when defining your general options. |
Security
Select to limit the list of users who can change the status of a contract to only those to whom you have given security access on the User Preferences - Contracts page. |
|
Delete Internal Notes |
Select to enable users to delete internal notes. |
Update Internal Notes |
Select to enable users to update internal notes. |
Access the Contracts Definition - Defaults page (Set Up Financials/Supply Chain, Business Unit Related, Contracts, Contracts Definition, Defaults).
Contract
Contract Admin (contract administrator) |
Select a contract administrator for this business unit. This value automatically populates the contract administrator field on the contract header. |
Contract Type |
Select a value to categorize the contracts for reporting purposes. |
Dist Rule Code (distribution rule code) |
Select the distribution rule code for the business unit. The distribution rule code identifies the distribution rules to use for a particular product when the product is selected onto the contract within this PeopleSoft Contracts business unit. You can define any number of combination criteria and hierarchy for the distribution rules. These rules tell the system how to identify and in what order to apply the accounting distribution sets. |
Unbilled AR (unbilled accounts receivable) |
When you manage revenue from PeopleSoft Contracts, revenue is booked to an unbilled AR account. When billing occurs, PeopleSoft Billing generates an offsetting entry. The system uses this unbilled AR account as the high-level default value for every contract entered in this business unit. Note. If deferred revenue is turned on at the installation options level, an unbilled AR/deferred revenue entry is generated, and revenue is moved from deferred when booked. |
Legal Entity |
Select a legal entity for this business unit. While this legal entity is not directly linked to the legal entity in PeopleSoft General Ledger, this field allows you to capture which legal entity contracted with the customer on each contract. This value, which is a default on the contract, can be overridden. This value automatically populates the appropriate field on the contract header. |
Billing Plan
Bill Type |
Select a default bill type for contracts created under this PeopleSoft Contracts business unit. The bill type represents the category of activity being billed. |
Bill Source |
Select to enable PeopleSoft Billing to identify where the billing activity came from and then to associate default billing information with that billing activity. |
Taxes
Ship From |
Select from location codes defined on the Location Definition page. This value is used as a default for each contract but can be overridden on the billing plan. The system uses the ship from value as a portion of the location information that determines value-added tax. |
Prepaids
You can enter values at the business unit level to populate by default onto the Prepaid component for prepaid setup.
Note. Prepaid defaulting applies to new prepaid billing plans only. If you change these values at the business unit level, the system does not update existing billing plans to which the changed business unit applies. The new values apply only to new billing plans that are created on this business unit.
Prepaid Tax Timing |
Select the timing of when prepaids are taxed. Select fromTax on Initial Bill or Tax on Utilization. This value appears by default on the prepaid setup for contracts created using this business unit. You can override this value on the prepaid setup pages. |
Billing Plan Template |
Select a billing plan template to associate with the prepaid contract line. The billing plan template automates the creation of the billing plan. |
Bill Plan Detail Template |
Select a billing plan detail template to associate with the prepaid contract line. Use the billing plan detail template to override the billing defaults that are defined for a contracts billing business unit and contract header. Note. If you want to select a billing plan detail template, you must also select a value in the Billing Plan Template field. |
Deferred Revenue |
Select the deferred revenue distribution code to associate with the prepaid contract line. Booking to deferred revenue enables you to post to the general ledger revenue that you expect to realize in a future accounting period. |
Utilize Against All Lines |
Select this check box to apply the prepaid towards all contract lines. Note. If you want to apply the prepaid against a specific contract line, you must enter the contract line manually in the Prepaid component. |
Progress Payment Rates
Progress Payment Rate |
Enter the progress payment rate percentage that you wish to use for your government contracts. This value appears by default on the Progress Payment Terms - General page and can be overridden |
Liquidation Rate |
Enter the progress payment liquidation rate percentage that you wish to use for your government contracts. This value appears by default on the Progress Payment Terms - General page and can be overridden |
Note. The data in this group box only applies to contracts with a classification of Government.
Contracts Workbench Template
Workbench Template ID |
Enter the template ID that the system uses when a user views the Contracts Workbench for this business unit. The system uses the records and fields in the Contracts Workbench that are selected for this template. The only templates that are available to choose from are those where Contracts was selected in the Workbench Type field. PeopleSoft delivers the CONTRACTS template, which is the default template for all Contracts business units. |
Access the Contracts Definition - Processing Options page (Set Up Financials/Supply Chain, Business Unit Related, Contracts, Contracts Definition, Processing Options).
Select to indicate whether a user can override the deferred revenue option on the contract line. At the product group level, you specify whether to use deferred revenue for a product group. The product group attributes for deferred revenue appear by default on the contract line. If you select this deferred revenue override option at the business unit level, you can override the deferred revenue option that automatically populates from the product group. Therefore, if you do not turn on deferred revenue at the product group level, you can still select it at the contract line level as long as you selected the deferred revenue override option at the business unit level. If you do not select this check box and deferred revenue is not specified for a product group, the deferred revenue option is unavailable for the contract line, and the Deferred Revenue tab does not appear. Booking to deferred revenue enables you to post to the general ledger revenue that you expect to realize in a future accounting period. If a contract is in Pending status, you can turn deferred revenue on or off at the contract line level. If a contract is in Active status, you cannot change this setting on the contract line and you must use amendment processing. However, you can use amendment processing to turn deferred revenue on or off only if this override is selected and if no deferred revenue or revenue processing has occurred. |
|
The contract line inherits its revenue recognition method from the product definition. Select this override check box to enable users to change the revenue recognition method on a contract line. When this override check box is not selected, the system processes the revenue for the contract line by the default revenue recognition method. |
|
Edit Combinations |
Select the Edit Combinations check box if you want the Accounting Rules Process (PSA_ACCTGGL) to run the combination edit process for transactions processed by the PeopleSoft Transaction Billing Processor. Note. The Edit Combinations feature is only used by the PeopleSoft Transaction Billing Processor. |
Proration Method |
Provides the rules that the system uses to determine how much to apportion to each event for revenue plans with a revenue recognition method of apportionment. Select from:
|
Future Period Accounting Dates |
Stipulate the date that should be used as the accounting date for apportionment revenue recognition events. Select from:
|
On Demand Options
Bill Plan Detail Template ID |
Select a bill plan detail template ID to override the fields on the billing plan for on-demand contracts. If you select a template on this page, the billing plan detail template overrides the corresponding fields on the billing plan when a billing plan is created through Contract's integration with the PeopleSoft Transaction Billing Processor. |
Note. This group box is for on-demand transactions only.
Renewal Options
Review Timing |
Enter a value from 0– 999 in days. The system uses this value to determine when you must begin reviewing renewable contract lines. You can override this value for each renewable contract line on the Review Renewals page using either the control or default settings that you select on this page. |
Control |
Select the Control option to enable users to override the Review Timing Days field on the Review Renewals page with a value that is greater than or equal to the value entered in the Review Timing field. |
Default |
Select the Default option to enable users to override the Review Timing Days field on the Review Renewals page with a value that is less than, greater than or equal to the value entered in the Review Timing field. |
Line Amendment Default Options
Here are the Default Adjustment Options for Amending a line:
Change Billing Retroactively |
Select this option to enable the system to adjust billing events retroactively when a contract line is cancelled or the contract line amount is modified during amendment processing. The option selected at the business unit level can be overridden at the contract line level. If this option is not selected at the business unit or contract line level, the user can only adjust any remaining future events for the contract line. |
Change Revenue Retroactively |
Select this option to enable the system to adjust revenue events retroactively when a contract line is cancelled or the contract line amount is modified during amendment processing. The option selected at the business unit level can be overridden at the contract line level. If this option is not selected at the business unit or contract line level, the user can only adjust any remaining future events for the contract line. |