Contract Process Options
Contract process options enable you to determine a specific contract process that you use throughout the entire contract life cycle. Select a contract process option upon first entering the Contract Entry (CNTRCT_ENTRY) component. Contract process options include:
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Recurring Voucher
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Prepaid Voucher
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Prepaid Voucher with Advance PO
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Recurring PO Voucher
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Purchase Order
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Manufacturer
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Distributor
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Group Single Supplier
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Group Multi Supplier
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Special Purpose
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Release to Single PO Only
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General Contract
Open-item contracts apply to Purchase Order, Release to Single PO, Recurring PO Voucher, and General Contract only. Category contracts are available on General and PO process options type contracts. You use a specific contract process option to drive the functionality for the entire contract. Only fields that are relative to the contract process option that you choose appear on the page.
Recurring Voucher Contracts
Using recurring voucher contracts, you can establish and schedule amounts for recurring payments, such as rent and lease payments, utilities, and regular supply deliveries, and you can generate the resulting vouchers. When each voucher comes due according to the payment terms of the supplier and business unit, the voucher is approved and paid. You can adjust the amount of individual vouchers during the life of the contract.
Retention is also supported for recurring voucher contracts and their recurring payment releases. A retention amount or percentage can be applied to all voucher contract releases, only the first release, or only the last release. A separate schedule is created on the voucher for the retained amount and placed on hold.
You can release a recurring voucher contract across multiple business units. This reduces the overhead of maintaining several contracts covering the same items that differ primarily by business unit.
You can also enter miscellaneous charges at the header level of recurring voucher contracts and carry the charges to the voucher.
Prepaid Voucher Contracts
Use the Prepaid Voucher contract process option to indicate that the contract is a prepaid voucher contract (without advance purchase order). Select to enter a prepaid reference on the Contract page.
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Miscellaneous charges are not available for Prepaid Voucher or Prepaid Voucher with Advance PO contracts.
Note:
If a Prepaid voucher is associated to a source document and references an item containing UPN details, the prepaid voucher thereby created contains the UPN details.
Prepaid Voucher with Advance PO Contracts
Use the Prepaid Voucher with Advance PO contract process option to indicate that the contract is a Prepaid Voucher with Advance PO contract. Select to enter a prepaid reference, a PO business unit, and a PO ID on the contract header. If the voucher is not yet staged, you can change to any other contract process option. After the voucher is staged, you cannot change this contract process option.
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The contract maximum amount cannot exceed the total purchase order amount.
A purchase order can be referenced on only one prepaid voucher with advance PO contracts.
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If a Prepaid Voucher with Advance PO Contracts references an item containing UPN details, the voucher thereby created contains the UPN details.
Recurring PO Voucher Contracts
Recurring PO vouchers enable you to encumber an entire contract amount for a voucher contract by associating the contract with a specific purchase order. As you generate voucher releases over time, the system liquidates the purchase order amount when you run budget checking against the vouchers.
You can use one or multiple vouchers that are associated with the encumbered purchase order. You create the purchase order using the Contract Release page. Then you build the purchase order and run budget checking against it. The system creates a purchase order with an encumbrance for the amount of the contract. You define release dates and generate staged voucher releases. You also build the vouchers and run budget checking against them, and the system liquidates the associated purchase order for the voucher amount.
Note:
If you create a purchase order to use with a recurring PO voucher contract and the PO status is Initialized, then releases don't exist on the purchase order and the purchase order header and schedule are display-only. You cannot insert rows manually at the line and schedule level either.
Purchase Order Contracts
You can create purchase order contracts that establish pricing terms and conditions that may offset or supplement regular pricing agreements with suppliers. From these purchase order contracts, you generate order contract releases that use the contract for their terms and conditions. These contracts may have been established by the awarding of a request for quote (RFQ) response or Strategic Sourcing Event to a contract. In turn, this RFQ or Strategic Sourcing event may have been created from a requisition. When a contract originates from a requisition, the purchasing releases carry the requisition keys to the purchase order. When budget checking is run against this purchase order, the requisition amounts or quantities are liquidated.
You can also create, retrieve, and receive purchase orders by referencing the contract and appropriate release number. The combination of the contract ID, contract line number, and contract release number provides the chronological audit trail that the business community generally associates with blanket orders.
If a contract originates from a requisition that is distributed by amount, for the first release of the contract (and later if the contract no longer exists on an active purchase order), the generated releases include the entire requisition amount and quantity with the same distribution percentages, amounts, and quantities—regardless of changes in the contract. However, all other generated releases reflect the contract's specifications.
If a contract originates from a requisition that is distributed by quantity, for the first release of the contract, the requisition keys are assigned to the purchase order staging tables when a requisition distribution contains an open quantity. For example, if the contract release is for a quantity of 5 out of the possible quantity of 10 from the requisition, the remaining quantity on the requisition is 5. If the next contract release quantity is for 10 from the same requisition, the Stage Contract PO process releases 5 from the requisition, which leaves no remaining quantity on the requisition.
Manufacturer Contracts
Manufacturer contracts provide the ability to identify items offered by one or more suppliers, and specify item defaults and prices. You specify the Manufacturer ID on a Manufacturer contract, and associate related distributors to use when purchasing each item. Depending on set controls, each distributor can have their own markup or markdown percentage, as well as start and end dates.
Manufacturer contracts support control by business unit, contract domain, or ship to location for price variations. They also support agreements and all Supplier Contract Management document functionality. When a purchase order is released, the released amount and quantity is tracked by the system and visible from the manufacturer contract. This allows you to track the total amount spent with the manufacturer.
Distributor Contracts
Distributor contracts provide the ability to identify a supplier through which manufacturer contract items are purchased. Distributor contracts are linked to manufacturer contracts as child contracts, and can support default markup or markdown percentages, which are applied against the manufacturer-item base price.
A Distributor contract can be associated with multiple manufacturer contracts, and supports agreements and Supplier Contract Management documents. When a purchase order is released, the released amount and quantity is tracked by the system and visible from the Distributor contract. This allows you to track the total amount spent for a specific distributor.
Group Single Supplier Contracts
Use the Group Single Supplier process option when you want to group multiple contracts together for reporting purposes. With this structure you can add related child contracts to enable viewing summary information across all contracts in the group. In this case, the parent Group Single Supplier contract and all the related child contracts will be for the same supplier. With this process option you will be able to set agreements, notifications, and a Supplier Contracts authored document for the contract but you will not be able to specify items or categories or use the open item feature. No releases will take place directly against this contract.
See Creating Group Single- and Multi Supplier Contracts, and Special Purpose Contracts.
Group Multi Supplier Contracts
Use the Group Multi Supplier process option when you want to group multiple contracts together for reporting purposes. Like the Group Single Supplier process option you can add related child contracts to enable viewing summary information across all contracts in the group. Unlike the Group Single Supplier process option, the system defaults the supplier to the Default Reporting Supplier specified on the Contract Set Controls page so no supplier is specified when entering a Group Multi Supplier contract. In addition, all the related child contracts can exist for different suppliers. With this process option you will be able to set agreements, notifications, and a Supplier Contracts authored document for the contract but you will not be able to specify items or categories or use the open item feature. No releases will take place directly against this contract.
See Creating Group Single- and Multi Supplier Contracts, and Special Purpose Contracts.
Special Purpose Contracts
Use the Special Purpose process option when you need to associate a document to Service Level Agreements for a particular supplier, without any procurement contract release capabilities. Like the Group Single and Group Multi Supplier contracts, these are header level contracts that do not support open item, line item, or category releases. Unlike the Group Single and Group Multi Supplier contracts you may not link related procurement contracts, however you can specify which supplier locations are applicable.
See Creating Group Single- and Multi Supplier Contracts, and Special Purpose Contracts
Release to Single PO Only Contracts
Use the Release to Single PO Only contract process option to indicate that the contract is a Release to Single PO Only contract. Select to use one purchase order for the life of the contract. You define the purchase order on the Contract page. When the contract is saved, a purchase order is reserved for this contract and this contract process option cannot be deselected. In the PeopleSoft system, the functionality of purchase order contracts provides support for blanket orders by enabling you to associate a contract with a purchase order by assigning one purchase order to be used for the life of the contract. All transactions that reference this contract add lines or schedules to the assigned purchase order. Requisitions and PeopleSoft Supply Planning orders can also use this functionality.
General Contracts
Use the General Contract process option to indicate that the contract can be used for both purchase order and voucher references.