Applying Contracts to Requisitions

You can set up requisitions to automatically search for a contract to use for requisitions. Applying contract prices to requisitions enables you to receive contract prices for requisition items and to more accurately track budgets and pre-encumbrance balances. When the system applies contract prices, it controls the entire flow of the transaction, from the Requisition Loader to creation and update of purchase orders. Requesters, buyers, and administrators with the appropriate security can set to search for and use contracts on transactions at various levels.

The system uses the values in the requisition to apply negotiated contracts prices for purchases and transactions against the contract. The system searches for purchase order, general, and release-to-single PO only contracts. release-to-single PO contracts can be referenced manually on the requisition.

You use the Default Contract on Req check box on the Business Unit Options page to initiate the search. To access the page, select Set Up Financials/Supply Chain, and then Business Unit Related, and then Purchasing, and then Purchasing Definition, and then Business Unit Options.

To apply contracts to a requisition, the system locates possible contracts and copies them to requisition transaction lines when you create or change any of these fields on the requisition:

  • Supplier

  • Quantity

  • UOM (unit of measure).

  • Shipto

  • Item

  • Item Description

  • Category

To automatically supply a contract to a requisition, the system searches for and ensures that the correct contract is selected for use with the requisition and verifies that the Auto Default check box is selected on the Contract page. This makes the contract available to be automatically supplied to requisition and purchase order transactions.

You can override contracts at the line level that have been selected by the system. The initial value of the Use Contract if Available check box is Y regardless of the value of the Default Contract On Req check box for the business unit. If the item requires a contract, the system forces the Use Contract if Available check box to Y regardless of whether the contract exists on the line. Sourcing looks for the best contract if the contract is not referenced on the requisition line where this check box is selected. Deselecting this check box removes the contract information for the line (if any). However, the price will not be supplied again by default from the hierarchy to prevent overriding the user-entered price. Sourcing logic bypasses searching for the best contract for this line.