Modify Contract Revision Line Items

Explanation

Use this activity to add, modify, or delete contract revision line items.

When a new line item is added, the calculation type, mark up type, and valuation method will be copied to the new line, while the project ID, mark up work, mark up material, mark up miscellaneous, sales part site and report code will not be copied. You can override some default values, if required, in the respective override fields. Note that if a default value is modified on the contract, while a line item has a value for the same in the override field, the change you made will not affect the line item. The values in the override fields will take precedence over the values in the general fields. Therefore the change will only effect items that do not have an override value.

If the valuated item is not a work item or item to be consumed, it is recommended to use a separate line item for the stored material value to prevent mixing the value of the item and the stored material of the same item.

When a line item is modified, only the current revision of the item will be effected.

When deleting a contract line item, the line item is completely removed only if the contract revision is in the Planned status. If not, although the line item will be removed from the Items tab, it will be displayed on the Deleted Items tab instead. If Application for Payment is used and applications containing the deleted item exist, the item cannot be completely removed from the contract.

When adding and modifying line items, if Applications for Payment is used and applications in the Planned status exist, it is recommended to refresh the application with the latest contract information.

When an application for payment is created, the currency, supply country, unique project and billing sequence of the item are used to create a unique application. Billing sequence is a numeric value that you can assign to items that you wish to be grouped together, when you create the application for payment for them. A billing sequence can be added to an already existing line item only  if it has not been included in any application for payment.

Prerequisites

To add contract revision line items:

• A contract and contract line should exist.
• A contract should not be in the Lost, Canceled, Completed or Closed status.
• A contract revision should not be in the Obsolete or Canceled status.
• A contract revision should not be frozen.
• If the modification requires to be tracked then the Audit Trail Enabled check box should be selected, together with the Contract Change Order Required and/or Change Comment Required check boxes. It is also required to enter a contract change order and/or a change comment.

To modify or delete line items:

• A contract should not be in the Completed, Closed, Canceled, or Lost status.
• A contract revision should not be in the Approval In Progress, Obsolete, or Canceled status.
• A contract revision should not be frozen.
• A contract revision line item should be in the Planned or Work In Progress status.
• If the modification requires to be tracked, then the Audit Trail Enabled check box should be selected, together with the Contract Change Order Required and/or Change Comment Required check boxes. It is also required to enter a contract change order and/or a change comment.
• It is not allowed to modify the currency code, project ID, supply country or billing sequence of an item, if that item has been included in an application for payment.
• It is not allowed to delete an item, if it has been used in an application for payment which is not in the canceled state.

System Effects

• Contract revision line items will be added, modified, or deleted.
• When line items are modified and if the contract revision has the audit trail enabled:
  • The change status of the item will be set to Changed.
  • The old values of the changed line item will be logged on the Sales Contract/Change History tab together with any contract change order number and change comment entered.
• When line items are deleted:
  • The status of the deleted item will be changed to Deleted.
  • The removed item disappears from the Sales Contract/Items tab and is shown on the Deleted Items sub tab. It also displays any contract change order number and change comment entered if the contract revision is not in the Planned status.
• If the contract revision audit trail is enabled, the deletion will be logged on the Sales Contract/Change History tab.
• If a sales part is specified in a line item, sales price will be fetched from the sales part and the cost rate will be fetched from sales part or from the connected inventory part. If a configurable sales part is specified then cost rate will be set to zero.

Window

Sales Contract

Related Window Descriptions

Sales Contract
Sales Contract/Items
Sales Contract/Items/Lines/Items
Contract Change Order

Procedure

1. Open the Sales Contract window and click the Items tab.

To Add an Item,

2. Select the revision to which a line is to be added. The active revision will be displayed by default, or if there is no active revision, the most recent revision will be displayed.
3. Select the line to which an item is to be added in the upper table.
4. Add a new line in the lower table.
5. Enter an item number. If it is left blank, it will be calculated automatically by finding the highest line number for the contract and incrementing it by 1.
6. Enter a value in the Item Name field.
   Note: The mandatory fields will vary according to the values in the Calculation Method and Calculation Type fields. For further information see the Estimate Contract activity.
7. Select a calculation method from list. e.g. Per Unit.
   
   Notes:
   If the item is measured in quantities, the calculation method should be set to Per Unit or Rate Only. If the item depends on a fixed value the calculation method should be set to Fixed. There is no functional difference between Per Unit and Rate Only, but there is a fundamental difference from a contractual standpoint. Rate Only means that the quantity is only an estimate and is not contractually binding (e.g. time and material consultancy days), whilst Per Unit would normally imply that the quantity is fixed and should not be exceeded.
   
   When calculation type is Sales Value, the value in the Sales Value field is automatically calculated based on the quantity and sales rate entered. If the calculation method is Fixed then you can enter a value in the Sales Value field directly.
   
   When calculation type is Cost Value, the value in the Cost Value field is automatically calculated based on quantity, cost rate and the cost rate factor.  If the calculation method is Fixed then you can enter the cost value and markup. The sales value is automatically calculated based on the values in the Cost Value and Markup fields. The markup value will vary according to the item type, which can be pre-defined, and can be retrieved accordingly. You can enter markup values in either the Markup field in the Sales Contract/Items tab or the Sales Contract/Markups tab.
8. The Calculation Type field is set according to the default value defined for the contract, but you can change it if necessary. When creating a new contract the default calculation type is Sales Value.
9. Enter the item sales currency. The contract currency is taken as the default value. Use the List of Values to select a different value. The item cost currency is always the company currency and it cannot be modified.
10. Enter a planned start date and/or a planned finish date. This will make it is easier to plan contract deliverables with more detail. Note that entering a planned start date is mandatory.
11. Enter information in any other field as necessary.

Note: If Audit Trail Required, Contract Change Order Required and/or Change Comment Required check boxes have been selected for the contract revision, it is required to enter a change order number and change comment to be able to save the change.
12. Enter a number in the Billing Sequence field for the item if you wish to include it into separate application for payments. 
13. Save the information.

To Modify an Item,

1. To modify the line items, in the upper table of the Sales Contract/Items/Lines/Items tab, select the line to which the item you want to modify belongs.
2. Select the item to be modified and modify the values of the item as required.
   Note: If Audit Trail and Contract Change Order Required and/or Change Comment Required is enabled on the contract revision, it is required to enter a change order number and change comment to be able to save the change.
3. If you wish to change the supply country and the report code for the item, select the required country from the list and the report code from the List of Values.
4. Save the changes.

To Delete an Item,

1. To delete the line items, select the line to which the item to be removed belongs.
2. Click Remove on the toolbar.
3. Save the changes.