Service Contracts Management

Contents 1 Introduction 2 Contract Header 3 Invoice Plan Master 3.1 Contract Renewal Process 4 Invoice Plan 5 Order History 6 Invoicing History 7 Reservation 8 Common operations with contracts 8.1 Define contract duration 8.2 Clone contracts 8.3 Manage product lifecycle in contracts 8.4 Contract Billing Process 8.5 Contract billing on behalf of other Business Partner 8.6 Contract termination

Introduction

A contract describes the exchange of goods or services (it may be renewable) from vendor to buyer for an agreed upon value in money during a period of time. The contract can be either a sales or purchase contract.

Advanced Contract Management Module provides full support to manage service contracts, as memberships.

Contract Header

A contract describes the exchange of goods or services (it may be renewable) from vendor to buyer for an agreed upon value in money during a period of time. The contract can be either a sales or purchase contract.

Once a contract is setup, don't forget to click on Complete process button. This process changes the contract status from Draft to Active, and avoids changes in contract definition. This process can be reverted with Reactivate button.

By default, Openbravo does not allow to reactivate contracts with linked Invoices or Sales Orders. If you need to make possible to reactivate contracts, yo can define the an attribute in Preference window to allow that:

• Property List = N
• Attribute = AllowToReactivateContractsWithOrdersOrInvoices
• Value = Y, means that contracts can be reactivated. Value = N, means that contracts can not be reactivated when there exists sales invoices and/or sales orders attached to them.
• Visibility
  • Window = Contract

Invoice Plan Master

Invoice plan lines will be automatically generated based on the information entered in this tab

The Invoice Plan Master defines all the products and services included in the contract, and also the period in which this products are active. This information is used, in addition to Contract Invoice Schedule configuration to create the Invoice Plan.

1. Create a new Invoice Plan Master line
2. Add a product, and quantity
3. Price: The price is inherited from the price list defined in contract header. But if a Net Unit Price is manually indicated in the Invoice Plan Master line, then the price list will be ignored when creating the invoice plan, and the price indicated in Invoice Plan Master line will be used.

Once the contract is completed (Status=Active), the Invoice Plan is build using the information defined in Invoice Plan Master tab, and also taking into account the Contract Invoice Schedule in contract header.

Invoice Plan is automatically updated by Renew contracts background. This process not only renews the contract, but also updates the Invoice Plan, creating new lines if required (i.e. if new products are changed or added to the contract, or based on "cover to" date).

Contract Renewal Process

Contracts with Automatic renewal = Y are renewed till Cover Date, that is automatically calculated based on the notice period. Invoice plan lines are created till cover date, unless an earlier date is informed in Ending Date field.

The contract renewal occurs in two ways:

1. Automatically, by the “Renew contracts background” process
2. Manually, using “Renew contract” button

Renew contracts background process needs to be activated in “Process Request” window.

1. Process name: Renew contracts Background

This process needs to run once a day, so schedule it using daily frecuency.

Note: Don’t forget to click on “Reschedule” process button to activate it!

Invoice Plan

An invoicing plan is defined at contract line level (see Invoice Plan Master section). For each contract line you can configure the invoicing plan, it could be slightly different depending on the kind of business process you are carrying out.

Invoice plan reflects next invoices to be created from the contract. Invoice plan lines are automatically generated and updated.

Also, you can add new lines manually to the invoice plan lines. Those lines manually aded, or the lines manually updated are no updated by the renewal process. This allow you to manually add lines that wont be deleted when the Invoice plan is deleted or updated, or change the price in a concrete line.

Order History

Read only tab which includes the order lines associated with the contract. These are the orders that will result in an additional charge.

This tab shows all the Sales Orders in the system linked to the contract. This line also allows to check the invoicing status of the sales order.

Sales orders linked to a contract are taken into account to be invoiced trough the execution of Contract billing process.

Invoicing History

Invoices associated with the contract.

This tab shows all the Invoices in the system created from this contract. This tab also allows to check the payment status of the Invoice. Contract invoicing is executed trough Contract billing process.

Reservation

Reservation associated with the contract.

It is possible to create reservations form contracts, in Reservations tab. Resources to be booked in contracts are filtered by "product category". This means that all the resources in the same "product category" than the product in Invoice Plan Master will be in "Resource" dropdown list.

Resources are also filtered by resource availability (if you put first the starting and/or ending dates for the reservations only available resources for that period are proposed).

In contracts resources are suposed to be booked in a daily basis, so you cannot specify starting and ending hours (all reservations will be created for full days).

In order to make a new booking linked to the contract, follow this steps:

1. Create new line in Reservation tab
2. Set an Starting Date (Ending Date is optional). If Ending date field is blanck, means that the booking will be active while the contract/Product is valid. This Ending date will be automatically populated when terminating the contract, using the same Ending Date defined in contract header.
3. In Resource field select the resource to book. In this Reservation tab in contracts, only those resources with a daily basis reservation calendar are displayed (hourly basis resources are more likely to be booked using Room Reservation widget, i.e. Meeting rooms and so). This dropdown list only will display those resources that are available for defined time range.
4. (Optional) Add contact/User information, and also a Name or Description for this reservation.

Common operations with contracts

Define contract duration

Contract duration can be defined in different ways:

• Fixed duration: Set an Starting date and an Ending date in contract header, and the contract duration is automatically calculated and populated in contract header. The cover to date will be set as the contract ending Date
• Automatic renewal: A contract can be defined without an Ending date, which means that the contract or subscription will be active till an Ending date is provided. In this case, Cover to date is calculated based on the contract duration and it will be updated every time the contract is renewed.

Clone contracts

Contracts can be cloned, as a way to create new contracts based on existing document.

Manage product lifecycle in contracts

• Add new products

new products can be added to an active contract at any time. Just add a new line in Invoice Plan Master tab, set Starting date, product and quantity (Ending Date is optional). The price will be inherited from the price list. The system will automatically update the Invoice Plan to add new lines for this new product.

• Terminate and/or substitute a product

In order to terminate a product in a contract, just populate Ending date field. The Invoice Plan will be updated with this change. Substituting a product requires to terminate an existing product, and then add a new line with the new product.

Contract Billing Process

Contract billing is launched through Contract Billing Process window.

From this window you can run billing of contracts in batch, and allows to launch this process setting some filters.

The process "Contract Billing Process" bill drafts invoice proposals, which once supervised, should be converted into final invoices.

This process can be performed automatically using the Contract Invoicing background process.

Warning: Before launching Contract Invoicing process be sure your system is properly configured and check data quality. This process wont create invoice draft, but completed AR invoice documents.

Contract billing on behalf of other Business Partner

Sometimes it is needed to invoice a contract, or some products in the contract to a different Business Partner (i.e. when a chamber of commerce pays a membership contract in a coworking space, or some of the products in the contract during a time period).

Bill to field is available in contract header and also in Invoice Plan Master or Invoice Plan lines. When adding a BP in Bill To field in header, this BP will be charged for the full contract content, while if it is added in lines, only the product in the line will be charged to that BP.

Contract termination

Contract termination process changes the contract status to "Expired", which means that the services/products associated to the contract are not provided anymore.

When an ending Date is set up in contract header, a new process button "Terminate" appears in contract window. Click on it to terminate the contract.

Please note that an expired contract can still generate new invoices as long as there are pending invoice plan lines to be invoiced. If you don't want to invoice these lines, you must set an ending date in the affected Invoice Plan Master lines and update the invoice plan. The system will automatically remove the lines after that ending date so no new invoices will be generated.

Full list of Contract window fields and their descriptions is available in the Contract Screen Reference.