1. Using Procurement
  2. How You Create Purchase Orders for Complex Services with Progress Payment Schedules

How You Create Purchase Orders for Complex Services with Progress Payment Schedules

You can define progress payment schedules for fixed-price services, which are of high value and have long lead times. Using progress payment schedules, you can allocate estimated costs to various portions of work in a complex contract.

You can use purchase order schedules to model the payment schedules for your complex contracts. The payment schedules could be either for a lump sum amount or rate-based.

  • Lump Sum: Specify the purchase order schedule type as a lump sum if payment needs to be released based on the stage of work completion. For this schedule type, specify the work description and the associated cost.

  • Rate: Specify the purchase schedule type as a rate if payment needs to be released based on the units of work completed. For this schedule type, specify the work description, unit price, quantity and unit of measure.

You can use the Complex Work Style document style for creating purchase orders for procurement of complex services. Orders created using this document style are enabled for both progress payments and retainage. When you create purchase orders from a backing requisition or negotiation outcome by selecting a document style enabled for progress payments, the resulting order will have one default lump sum schedule with the entire contract sum allocated. You can create additional progress payment schedules by splitting an existing schedule online or using REST services. To create progress payment schedules in bulk, use the Oracle Visual Builder Add-in for Excel with REST services.

When creating a change order, you can modify these new progress payment schedule attributes: Type, Description, and Price. You can modify the schedule's Type and Description until a receipt or invoice is created. If you modify any of these attributes using the seeded change order template, the application will create an external change order.

To create purchase orders for procurement of complex services, you can either use the seeded Complex Work Style document style or create a new document style and set the Progress Payments Enables to Yes.