Managing Contract Compliance

CONFIDENTIAL 2019-02

Managing contract compliance © 2019 SAP SE or an SAP affiliate company. All rights reserved.

SAP Ariba Procurement solutions

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Content

Contract compliance in SAP Ariba Procurement solutions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 Topics about how contract terms are applied to orders and invoices. . . . . . . . . . . . . . . . . . . . . . . . 7 Ordering, receiving or invoicing against contracts. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 No-release order contracts. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8 Automatic creation of contract-based invoices for evaluated receipt settlement . . . . . . . . . . . . . . . . . . . 11 Contract-based invoices in SAP Ariba Commerce Automation with SAP Ariba Contract Invoicing. . . . . . . 12 Contract-based invoices in SAP Ariba Invoice Management or SAP Ariba Buying and Invoicing. . . . . . . . . 13 Release order contracts in SAP Ariba Catalog. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 Release order contracts in SAP Ariba Buying and Invoicing or SAP Ariba Buying. . . . . . . . . . . . . . . . . . . 14 Topics about how contracts are selected during ordering or invoicing. . . . . . . . . . . . . . . . . . . . . . .17 What is autoselection of contracts. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17 Autoselection Criteria for Catalog Items. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18 Autoselection Criteria for Non-Catalog Items. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18 Autoselection Reevaluation on Requisitions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19 Manual selection of contracts. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .19 Manual Selection Reevaluation on Requisitions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20 Manual Selection Reevaluation on Contract-based Invoices. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20 Topics about blanket purchase orders. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .21 What are blanket purchase orders. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .21 Release order BPO process flow. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22 No-release order BPO process flow. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22 Restricting suppliers from viewing amount and unit price values in BPOs. . . . . . . . . . . . . . . . . . . . . . . . 23 Topics about contract hierarchies. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24 Contract relationships in contract hierarchies. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24 Accumulation of contract spend in contract hierarchies. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26 Compound and override pricing in contract hierarchies. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27 Contract request and contract statuses. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29 Purchasing unit filtering in contracts. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31 Effective and expiration dates in contracts. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .33 Accounting information on contracts. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34 Accounting information defaulting on contracts. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34 Accounting field defaulting on release orders against contracts. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .35

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Accounting defaulting behavior on contract-based invoices. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37 Topics about contract limits and limit enforcement. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38 Contract limits. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38 Overall contract limits. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39 Overall Line Item Limits. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39 Minimum and maximum contract limit enforcement on release orders. . . . . . . . . . . . . . . . . . . . . . . . . 39 Notification limits. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43 Topics about contract accumulators. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44 Contract accumulators. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44 Preload Amounts. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46 Accumulator updates. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47 Contract request import using Microsoft Excel . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48 Sample Microsoft Excel spreadsheets. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .48 Spreadsheet Import Notes. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49 Topics about creating and managing contracts. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50 How to create a contract. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50 How to create a new contract using the contract wizard. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51 How to copy a contract. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51 How to upload an Excel version of a contract. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52 How to define general contract information. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52 How to define contract limits, notification recipients, and forecasting. . . . . . . . . . . . . . . . . . . . . . . . . . .57 How to create a milestone for a contract. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60 How to control edit and release access for contracts. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .61 Identifying Users Who Can Edit the Contract. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62 Restricting Which Users Can Release or Invoice Against the Contract. . . . . . . . . . . . . . . . . . . . . . . . 62 How to define payment terms in contracts. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63 How to add attachments to contracts. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 64 How to export contracts. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 64 Exporting a Submitted Contract. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65 Exporting a Contract During Approval. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66 How to create a contract for autogenerating requisitions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66 Topics about managing contracts. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 67 Considerations when closing or changing contracts. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 67 How to change, close, or reopen a contract. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69 How to change or cancel a contract release order. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 70 Topics about pricing terms in contracts. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 72 Discount pricing in contracts. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 72 Catalog Imports and Repricing for Discount Pricing. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .72 Managing contract compliance Content

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Tiered pricing in contracts. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 73 Tiered pricing types. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .74 Term-based pricing in contracts. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 76 Limitations to Term-Based Pricing. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .76 Term-based Discount. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 76 Term-based Pricing. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 77 Defining Term Boundaries. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .77 Term-based grid pricing in contracts. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .78 Formula pricing in contracts. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 79 Multiplier Pricing. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 80 Matrix Pricing. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 80 Specifying Currency Values in Formula Pricing. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 81 Repricing for tiered and term-based pricing. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .82 Repricing of cumulative tiered-priced items. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 82 Repricing of per-order tiered or term-priced items. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 82 Support for CLID fields. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .83 How to define pricing terms on contracts. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 83 How to configure pricing terms for a supplier-level contract . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 84 How to configure pricing terms for a commodity-level contract request. . . . . . . . . . . . . . . . . . . . . . 86 How to configure pricing terms for item-level contracts. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 88 How to define pricing tiers on contracts. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 97 How to define term-based pricing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .98 How to define term-based grid pricing. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 99 How to define formula pricing in contracts. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 103 Managing compliance contracts with SAP Ariba Contracts. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 107 Revision history. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 109

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Contract compliance in SAP Ariba Procurement solutions

A contract is an agreement between a buying organization and a supplier that identifies the terms for purchasing goods and services repeatedly over time. A contract is an agreement between a buying organization and a supplier that identifies the terms for purchasing goods and services repeatedly over time. A contract enables a buying organization to negotiate discounts based on a volume or dollar amount of future purchases, and provides a supplier with a more regular stream of sales, along with the ability to more accurately forecast demand for its products.  Example A company that expects to steadily add staff over a period of two years might negotiate a contract with a supplier to provide office furnishings as needed over that period. The company can negotiate a discount based on its guarantee to purchase everything from that supplier, and the supplier can better manage its inventory and forecast sales based on a known level of future business. SAP Ariba Procurement solutions support four types of contracts: ● Supplier level, which covers all products from a supplier. ● Catalog level, which covers all products from a catalog. If a catalog-level contract includes PunchOut items, the contract terms are applied to an item only if that item's part number and auxiliary part ID returned from the external PunchOut site is part of your catalog subscription. ● Commodity level, which covers all products identified by specific commodity codes from a supplier. ● Item level, which covers specific items from a supplier. Depending on the type of contract and your site’s configuration, the terms of the contract are applied when: ● Purchasing users or agents order items that have a contract associated with them. The contract terms are automatically applied when they add the items to their order. ● Purchasing users or agents create a purchase order (or release order) against the contract. ● Supplier or buyer users create invoices against the contract. To create a contract in your SAP Ariba solution, you first create a contract request that defines the properties of the contract, and that request must be approved in order for the contract to be created. Depending on the solutions enabled in your site, you either start the contract creation in your contract workspace [page 107] (if your site is enabled for SAP Ariba Contracts) or by using the Create dashboard (if your site does not use SAP Ariba Contracts).

Contract Request

option [page 50] from your

 Note ● In sites configured for SAP Ariba Catalog only, you cannot define contracts where the contract terms are applied during invoicing. ● In sites configured for SAP Ariba Buying only, you can define contracts for invoicing for the purpose of exporting the information to your external ERP. You cannot create contract-based invoices in SAP Ariba Buying. ● In sites configured for SAP Ariba Invoice Management only, you cannot define contracts where the contract terms are applied on the order.

Managing contract compliance Contract compliance in SAP Ariba Procurement solutions

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The following diagram outlines the contract request process:

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Managing contract compliance Contract compliance in SAP Ariba Procurement solutions

Topics about how contract terms are applied to orders and invoices

Ordering, receiving or invoicing against contracts [page 7] No-release order contracts [page 8] Automatic creation of contract-based invoices for evaluated receipt settlement [page 11] Contract-based invoices in SAP Ariba Commerce Automation with SAP Ariba Contract Invoicing [page 12] Contract-based invoices in SAP Ariba Invoice Management or SAP Ariba Buying and Invoicing [page 13] Release order contracts in SAP Ariba Catalog [page 14] Release order contracts in SAP Ariba Buying and Invoicing or SAP Ariba Buying [page 14]

Ordering, receiving or invoicing against contracts When you create a contract, you need to decide when the contract terms are applied. Contracts terms can be applied when users create orders, invoices, or receipts. Certain options might not be available to you depending on your site configuration and enabled features. Contract terms for a release order contract (the Release Required option is Yes on the contract) are applied during the order process when users add items associated with the contract to an order. Contract terms for a no-release order contract are applied when users create invoices or receipts against the contract. If you allow receiving and invoicing against a no-release order contract, your SAP Ariba invoicing solution uses three-way matching (invoice-contract-receipt). See Contract-based Receipts [page 9] for more information on receiving for no-release order contracts. The following table shows the types of contracts that are available depending on your site’s enabled features and provides a high-level overview on how the contract terms are applied. Enabled features

Contract release type

Contract terms applied when ...

SAP Ariba Catalog

Release order contract

Users punch in to the catalog to add items to a shopping cart.

SAP Ariba Buying

Release order contract

Users create an order.

SAP Ariba Buying and In­ voicing

Release order contract

Users create an order.

No-release order contract

Managing contract compliance Topics about how contract terms are applied to orders and invoices

●

Users create a contract-based invoice.

●

Supplier users create a contract-based invoice on Ariba Network.

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Users create a receipt against the contract.

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Enabled features

Contract release type

SAP Ariba Invoice Manage­ No-release order contract ment SAP Ariba Catalog and SAP Ariba Buying and In­ voicing

Release order contract

Contract terms applied when ... Users create a contract-based invoice.

●

Users create an order in SAP Ariba Buying and In­ voicing.

●

Users punch in to the catalog to add items to the shopping cart. 

Note

Available contract compliance features for shopping carts and orders differ. For example, cumulative tiered pricing does not apply to shopping carts. Depending on your specific con­ tract compliance requirements, you might want to limit access to contracts by user group or use purchase unit filtering of catalog content. No-release order contract

SAP Ariba Catalog and Release order contract SAP Ariba Invoice Manage­ ment No-release order contract

SAP Ariba Buying and In­ voicing and SAP Ariba In­ voice Management

SAP Ariba Contract Invoic­ ing

Release order contract No-release order contract

No-release order contract

●

Users create a contract-based invoice.

●

Supplier users create a contract-based invoice on Ariba Network.

●

Users create a receipt against the contract.

Users punch in to the catalog to add items to the shop­ ping cart. ●

Users create a contract-based invoice.

●

Supplier users create a contract-based invoice on Ariba Network.

Users create an order. ●

Users create a contract-based invoice.

●

Supplier users create a contract-based invoice on Ariba Network.

●

Users create a receipt against the contract.

Supplier users create a contract-based invoice on Ariba Network. For more information, see Contract-based in­ voices in SAP Ariba Commerce Automation with SAP Ariba Contract Invoicing [page 12]

No-release order contracts A no-release order contract provides additional pricing terms for fixed and recurring fee items and for costs and expenses. When you create a no-release order contract, contract terms are applied during invoicing when users create an invoice against the contract and, depending on your enabled features, during receiving. Contract terms for a norelease order contract cannot be applied to orders.

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Managing contract compliance Topics about how contract terms are applied to orders and invoices

No-release order contracts are typically used to create contract-based invoices for: ● Services. ● Fixed or recurring fee items. Fixed fee items have one occurrence, recurring fee items have multiple occurrences. ● Milestone payments. ● Cost or expense items. ● Evaluated receipt settlement (ERS) transactions. No-release order contracts are also useful in the following cases: ● Approval has been established for a negotiated contractual agreement that requires no purchase orders to release funds against the contract. ● The purchasing agent might not have the line item details to create a release order, such as with advertising contracts. You can also use a no-release order contract for bookkeeping purposes. In this case, you must set the contract’s Release Required (if available in your site), Allow invoicing against contract, and Allow receiving against contract flags (if available in your site) to No to prevent any receiving or invoicing against the contract. Additionally, you must set the contract’s hierarchical type to Standalone Agreement. If you create a contract in this manner, it can be used only to document contract terms for reference by other organizations. Another use of no-release order contracts is to accumulate spend within contract hierarchies, or to apply explicit contract price terms (through price overrides), or both. The following graphic shows the no-release order contract flow:

Contract-based receipts

When receiving is enabled for a contract, users can receive against items on the contract in much the same way as they receive against items on a purchase order. Some or all of the items on your contract may be configured for autoreceiving. Autoreceive rules are only evaluated if the contract is configured for receiving. See the Receiving chapter in the Purchasing guide for procurement professionals for general information about the receiving process. You cannot receive against cost or expense items as they do not have pricing details. Managing contract compliance Topics about how contract terms are applied to orders and invoices

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 Note ● If your site is configured for SAP Ariba Buying without the receiving option, you can create no-release order contract requests for the purpose of exporting them to your ERP or to an external contract management system. ● If your site is configured for SAP Ariba Buying with the receiving option, you can create no-release order contract request that allow receiving against the contract.

Approvables for contract receiving The following approvable documents are created for contract receiving: Approvable

Description

Receipt

Used to keep track of each receipt for a contract as it is submitted and approved. Contract re­ ceipts do not contain milestone items. Receipt approvable documents are also used to keep track of receipts for purchase orders.

Milestone tracker

Used to keep track of each milestone item on a contract. A milestone tracker is similar to a receipt, except that it used to verify a milestone item. Every milestone item has its own milestone tracker, which is created when the contract is cre­ ated. Milestone trackers are always created for milestone items, regardless of whether receiv­ ing is enabled for the contract, or whether the contract has release orders.

Partial receipts Because materials do not necessarily arrive from the supplier in a single shipment, and services are not generally provided all at once, you can enter partial receipts against contracts. Your SAP Ariba solution handles partial receipts by creating a new receipt approvable document with the remaining balance when the original receipt is partially received. Until the contract line-item limit or overall contract limit has been reached, contract receipts are partial receipts. When you receive against a quantity-based or amount-based contract line item that does not have a limit, all receipts are partial receipts. Partial receipts are not generated for milestone items on contracts because you can only receive a milestone by entering whether the milestone is completed. When a milestone is received, the percent completion on the milestone tracker is set to 100 percent.

Receiving types for contract line items When you add a line item to a contract, you specify whether the limit for the line item is amount or quantity based. When you specify that receiving is required, the contract line item is received according to this limit including any tolerances you have specified. For example, if the limit specified is quantity, then the item is received by quantity.

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Managing contract compliance Topics about how contract terms are applied to orders and invoices

For more information on setting limits for contract line items, see How to define contract limits, notification recipients, and forecasting [page 57].

Automatic creation of contract-based invoices for evaluated receipt settlement For supplier locations that are configured for evaluated receipt settlement (ERS) transactions, SAP Ariba Buying and Invoicing automatically creates invoices based on the associated no-release order contracts when goods receipts are fully approved. In addition, SAP Ariba Buying and Invoicing automatically creates invoices for items configured for recurring and fixed fee payments based on the payment frequency and billing dates configured on the contracts. SAP Ariba Buying and Invoicing inherits information, such as prices and payment terms that are specified for line items on the contract. All taxes for invoices are generated automatically from receipts that are based on taxes specified on the associated contract. The following are the prerequisites for ERS-based transactions: ● You must have a mutual agreement with a supplier to use ERS for purchasing transactions. When items on contracts are flagged for ERS transactions, suppliers cannot create invoices in the Ariba Network against those contracts. ● Ensure that a valid commodity code with receiving enabled is maintained for each material line item on the contract request. ● The order price of the materials must not be an estimated price. ● You must be a member of the Contract Manager group to approve items in contract requests for ERS and automatic invoicing transactions. The following is a high-level workflow of an ERS-based transaction for a no-release order contract: 1. The buyer user creates a contract request for items that need to be procured from ERS-approved suppliers. The buyer user configures the Fixed and Recurring Fees details to specify the date at which items are delivered and the frequency at which services are rendered. 2. A user responsible for approving line items for ERS transactions performs the following actions: ○ Ensures that the appropriate commodity codes are used for each item on the contract request. ○ Edits the details for each item on the contract request to ensure that the ERS Allowed field is set to Yes, and then approves the contract request. ○ Edits the details for fixed and recurring fee items to ensure that the Auto Invoice field is set to Yes. A no-release order contract is created. 3. The supplier ships the items to the buyer. 4. (For material items) The buyer user receives the items and approves the receipt transactions. Depending on the quantity of items received, SAP Ariba Buying and Invoicing generates invoices and credit memos with reference to the receipt: ○ If items are fully received, SAP Ariba Buying and Invoicing automatically creates an invoice and the transaction is passed for payment. ○ For items received in batches, SAP Ariba Buying and Invoicing automatically creates separate invoices for each batch based on the accepted quantity of items, and the invoices are passed for payment. ○ For line items on a receipt with negative values for the amount accepted, SAP Ariba Buying and Invoicing automatically creates a line-item credit memo. Managing contract compliance Topics about how contract terms are applied to orders and invoices

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5. (For fixed and recurring fee items) Depending on the frequency and billing date specified on the contract, SAP Ariba Buying and Invoicing automatically creates an invoice for fixed and recurring fee items on the scheduled date.

Contract-based invoices in SAP Ariba Commerce Automation with SAP Ariba Contract Invoicing SAP Ariba Commerce Automation customers can add SAP Ariba Contract Invoicing to their SAP Ariba solution. Contract invoicing for SAP Ariba Commerce Automation is delivered based on a reduced feature set of the SAP Ariba Invoice Management solution and includes the following functionality and benefits: ● Catalog Management: Catalog managers can load and maintain supplier catalogs. ● Contract Definition: Contract agents create contracts including catalog and non-catalog items, recurring items, cost and expense items and milestone items and to define the pricing terms for those items. Contract can be based on item level, commodity level, catalog level or supplier level. ● Contract Management: Contract agents and contract managers can close, change, or reopen contracts.

Limitations / unsupported functionality in SAP Ariba Contract Invoicing

A number of contract compliance features that are available in SAP Ariba Invoice Management are not supported or are not available in an SAP Ariba Contract Invoicing site: ● Spend against the contract is not accumulated on contract level and limits are not enforced, which means that a contract is not automatically closed when it is fully invoiced. Contracts are only automatically closed when the expiration date has been reached or when the contract agent manually closes the contract. ● Contracts of type blanket purchase order (BPO) are not available. ● Cumulative tiered pricing is not supported. ● Payment terms cannot be set on contract level. ● Milestone items cannot be defined. ● No invoice entry is available, and supplier-entered contract invoices are not submitted to SAP Ariba Contract Invoicing for reconciliation.

Workflow overview for SAP Ariba Commerce Automation with SAP Ariba Invoice Management

Suppliers follow the same workflow as described in Contract-based invoices in SAP Ariba Invoice Management or SAP Ariba Buying and Invoicing [page 13], except that the final invoice, after passing the validation rules and being digitally signed (if required) in Ariba Network, is sent as a cXML invoice to the buyer’s ERP system for reconciliation.

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Contract-based invoices in SAP Ariba Invoice Management or SAP Ariba Buying and Invoicing When you allow invoicing against a no-release order contract, your site can be configured to allow suppliers to create invoices against their contracts from their Ariba Network account. Depending on your site configuration, there are two workflow options: Option 1: Suppliers access your site from their Ariba Network account, but create the invoice entirely in your site. They follow the same invoice data entry process as users in your company that create a contract-based invoice. Option 2: Suppliers start and finish the invoicing process in their Ariba Network account using their familiar invoicing process to create an Ariba Network-validated contract invoice. The invoice is created in their Ariba Network account and submitted to your site for approval the same way as a standard invoice. Suppliers access your site transparently to retrieve certain contract information and add or edit items from the contract on the invoice. The following describes the workflow to create an Ariba Network-validated contract invoice: 1. Suppliers initiate the contract-based invoice creation from Ariba Network by selecting the customer for which they are creating the contract-based invoice. 2. Ariba Network automatically transfers the supplier user into your site, where the supplier user selects the contract, enters the invoice number and invoice date, and the Sold To Email (email of person who requested the goods or services). Depending on the contract specification, the Sold To Email address might be defaulted from the contact person on the contract. 3. The supplier user is then returned to the Create Invoice page in Ariba Network where they can enter additional invoice header information. 4. To add items to the invoice, the supplier user is again transferred into your site, where they select the items from the catalog. If allowed, they can also add non-catalog items.  Note For No-Release Contracts and Blanket Purchase Orders, when you click the Add Item button, the catalog item is added to a shopping cart in the catalog page. You can add multiple catalog items to your shopping cart and review them in the Review Cart page. Click Done to return to the Create Invoice page in the Ariba Network. 5. Depending on the contract configuration, the supplier user might enter accounting information. 6. After adding the line items, they are validated against the contract line items and the contract’s pricing terms are applied. If any discrepancies are found, the supplier user receives an error message to correct the information. 7. The supplier user is returned to Ariba Network. 8. To make changes to the items on the invoice, the supplier user is transferred back to your site. If allowed, the supplier user may change the unit price on the invoice. This effectively overrides the pricing terms defined on the contract for the item. For example, if a catalog level contract is defined with a 10% discount for all items, and the supplier changes the unit price of an item on the invoice, that price will be the final price used on the invoice. 9. In Ariba Network, the supplier user completes the invoice by adding other header fields as well as any comments, attachments, tax, shipping or special handling line items either to the invoice header or on line item level.

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10. The supplier user can always return to your site to retrieve additional items, change a contract header fields such as the Sold To Email, or edit or delete existing line items on the invoice. They can also change the contract, which effectively deletes the current invoice and starts a new invoice. 11. When the supplier submits the invoice, Ariba Network does a final validation against your invoicing rules defined for your Ariba Network account, digitally signs the invoice if your Ariba Network account has been enabled for digital signature, and sends the invoice to your site for reconciliation and approval. If the Invoice Compliance for Contract-based Invoices feature is enabled for your site, additional contract settings allow you to control certain functionality available to suppliers when they create a contract-based invoice. See Entering General Contract Definitions [page 52] for more information.

Release order contracts in SAP Ariba Catalog If your site is configured for SAP Ariba Catalog, you allow purchasing users to punch in to your SAP Ariba site from an external purchasing system to add items from the catalog to the shopping cart, which is then transmitted back to the ERP for order approval and execution. The following describes how contract terms are applied in SAP Ariba Catalog: 1. The users select items from the catalog. 2. If the users select a catalog or non-catalog item that is covered by a contract, and they have release access to that contract or the contract has unrestricted release access, SAP Ariba Catalog automatically selects the contract and applies it to the shopping cart line item. For more information on autoselection, see About the Autoselection Feature [page 17]. 3. If the users have release access to a contract, they can manually select items directly from that contract. For more information on manually selecting a contract, see About the Manual Selection Feature [page 19]. When the users check out their shopping cart, the available amount of the contract is automatically reduced. For more information, see Contract Accumulators [page 44], and Pricing Term Accumulators [page 45].

Release order contracts in SAP Ariba Buying and Invoicing or SAP Ariba Buying Release order contracts require a purchase order, or release order, to apply the contract pricing terms to the items on the release order and approve purchases from the contract. For example, if you have a contract to spend $10,000 with a supplier, you require a fully approved release order against that contract before the order is placed with the supplier. A release order contract has the following features: ● Release orders are used to consume funds from the contract. The available amount and other accumulators are adjusted automatically for the contract based on the purchase requisition status. ● Release orders support standard procurement functionality, such as change orders and line item split accounting. ● When you select a catalog or non-catalog item that is covered by a contract, the contract that is applied is ‘attached’ to the requisition line item. You can click on the contract link to review the contract details.

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● You can restrict release access to certain users or user groups. Only users you granted release access can select items directly from a contract when creating release orders. ● You can include pricing terms for materials, services, and commodities. The following graphic shows the release order contract flow:

How Release Orders are Created

Purchasing users can create a release order by: ● Selecting a catalog or non-catalog item that is covered by a contract. SAP Ariba Buying solutions automatically selects the contract and attaches it to the requisition line item. This feature is called autoselection. ● Manually selecting a contract, and then selecting items directly from the contract. This feature is called manual selection. Note that if you do not create subscriptions for non-catalog items, those items will not be available for review through the catalog view, and you have to enter the item information explicitly. See How to define general contract information [page 52] for more information. When purchasing users select items that are associated with a contract from the catalog, the contract price is transparently applied to the items when they are added to the requisition. If not all items in the requisition are associated with the same contract, or if some items are not associated with any contract, then SAP Ariba Buying solutions creates multiple orders from the requisition. For all items associated with the same contract, a contractspecific release order using a specific release order ID is created.

Release Order IDs

When SAP Ariba Buying solutions generates a release order, it uses the contract ID and the total number of release orders issued against the contract to create the release order ID. For example, suppose you create a requisition that results in a new release order for contract C10. The first release order issued against C10 will be numbered C10-R1, the second release will be numbered C10-R2, and so on. If release order C10-R1 is changed, the changed release order ID will be C10-R1-V2. Managing contract compliance Topics about how contract terms are applied to orders and invoices

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If the contract with which a release order is associated is changed, the contract version number is not changed in the release order ID. For example, if the original release order ID was C10-V2-R2, and the contract changed to C10V3, the release order ID will remain C10-V2-R2.

Release Access Control By default, when you create a release order contract, all users have release access. You have the option to restrict that access to a specific set of users. If you do restrict access to a contract, neither the contract nor any items governed by the contract are visible to users who are not allowed to release funds against the contract.

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Topics about how contracts are selected during ordering or invoicing

In the default configuration, applicable contracts get automatically selected during the purchasing process. Members of certain groups can also manually select a contract and create release orders against them. Invoicing against contracts always starts with the manual selection of the contract to invoice against. What is autoselection of contracts [page 17] Autoselection Criteria for Catalog Items [page 18] Autoselection Criteria for Non-Catalog Items [page 18] Autoselection Reevaluation on Requisitions [page 19] Manual selection of contracts [page 19]

What is autoselection of contracts Autoselection only applies to release order contracts. When users select a catalog or non-catalog item that is covered by a contract, the autoselection feature is triggered to select the contract and apply it to the item or items on the order or shopping cart. Autoselection is triggered also when users change the supplier, commodity code, quantity, or part number fields for an item while creating or editing a requisition or shopping cart. If an item is governed by multiple commodity level contracts, the contract with the most specific commodity type is selected. For example, if you have two commodity level contracts - Contract A which governs the Paper Materials and Products category, and Contract B which governs the Printing and Writing Paper - Contract B is selected and applied to the items for products within the Printing and Writing Paper category. A contract that has unrestricted release access—that is, release access is not restricted to a subset of users—can be autoselected for any user. A contract that has restricted release access can also be autoselected, but only for users on the contract’s release access list. The rest of this section describes when autoselection is triggered, and when it is reevaluated. It also describes the criteria that are used to autoselect catalog and non-catalog items. The autoselection feature is enabled by default. If purchasing unit filtering is enabled, any local contract matching the requisition line item and also matching the purchasing unit of the requisition or one of its parent purchasing units can get attached to the requisition.

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Autoselection Criteria for Catalog Items For catalog items, the autoselection feature selects a contract based on the following business logic: 1. For the selected supplier, the autoselection feature finds all the open contracts for which the user has release access. 2. From the list of contracts, the autoselection feature finds every contract line item—catalog or non-catalog— that might be a potential match for the catalog item. 3. From the list of potential contract line items, the autoselection feature selects the contract that provides the lowest price for the catalog item. 4. If multiple contracts provide the same price for the item, the autoselection feature selects a contract based on the most specific agreement type. From most to least specific, the agreement types are: ○ Item level ○ Commodity level ○ Catalog level ○ Supplier level For more information, see About Limits [page 38]. 5. Finally, the autoselection feature attaches the contract to the line item, and applies the contract pricing.  Note The price applied to a line item that is governed by cumulative tiered pricing can change during the lifecycle of the requisition. For more information, see Repricing of Cumulative Tiered-Priced Items [page 82].

Autoselection Criteria for Non-Catalog Items For non-catalog items, the autoselection feature selects a contract based on the following business logic: 1. For the selected supplier, the autoselection feature finds all the open contracts for which the user has release access. 2. From the list of contracts, the autoselection feature finds every contract line item—non-catalog or catalog— that might be a potential match for the requisition line item. 3. From the list of potential contract line items, the autoselection feature selects the contract that provides the lowest price for the item. The pricing on a matching contract line item applies to a non-catalog item in the following cases: ○ The contract is an item level agreement, or ○ The contract is a supplier- or commodity level agreement, and the creator of the contract selected the Apply pricing terms to non-catalog items? check box when creating the contract. If no contract line-item pricing applies to the item, the autoselection feature selects the most specific contract line item according to the agreement type. From most to least specific, the agreement types are: ○ Item level ○ Commodity level ○ Supplier level 4. If multiple contracts provide the same price for the item, the autoselection feature selects a contract based on the most specific contract type from most to least specific, as described in step 3.

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5. Finally, the autoselection feature attaches the contract to the line item, and applies the contract pricing.  Note The price applied to a line item that is governed by cumulative tiered pricing can change during the lifecycle of the requisition. For more information, see Repricing of Cumulative Tiered-Priced Items [page 82].

Autoselection Reevaluation on Requisitions Autoselection can also be triggered after a contract has been attached to a requisition. This feature is referred to as autoselection reevaluation. The following table describes when autoselection is reevaluated. Autoselection is reevaluated when... ●

The contract is changed before the requisition is submitted.

●

The contract is closed before the requisition is submitted.

●

The contract is changed after the requisition is submitted.

Considerations... If the new line item price is higher than the original price, a warning is displayed to alert the user to edit the requisition.

●

If the new line item price is higher than the original The contract is closed (manually, or because its expiration date has price, the Edit rules are also re-executed. been reached) after the requisition is submitted.

●

The contract is changed after the requisition is approved.

●

The contract is closed (manually, because its expiration date has been reached, or because its tolerance was exceeded) after the requisition is approved.

The requisition must not yet be in the Ordering or Or­ dered status. Regardless of the contract changes, the Edit rules are re-executed and the approval flow of the requisition is retriggered.

If you have enabled the Demand Aggregation feature on your site, when you submit a requisition, contracts get detached from line items that are held for aggregation. If the price of a held line item increases as a result, a warning message is displayed to inform the user about the reason for the same. If you manually select a contract, the autoselection feature does not override your choice. For more information on manual selection, see About the Manual Selection Feature [page 19].

Manual selection of contracts The manual selection feature allows purchasing or invoicing users to select a contract when they are creating a requisition, shopping cart, or a contract-based invoice, and then select items directly from that contract.  Note This functionality is available to purchasing users only if they are members of the Contract Release User group, or are members of the following procurement groups: Procurement Agent, Procurement Manager, Purchasing Agent, and Purchasing Manager.

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To manually select a contract for when creating a purchase requisition, on the Catalog Home page, click Contract in the Shop By area and search for the contract. To create a contract-based invoice, click Create > Contract-based Invoice on the dashboard.

Manual Selection Reevaluation on Requisitions Manual selection can be reevaluated after a contract has been attached to a requisition. The following table describes when a manually selected contract is reevaluated. If a manually selected contract is...

Your Ariba procurement solution... Displays a validation error. You must modify the requisition and delete the line item before submitting the requisition.

●

Changed before the requisition is submitted.

●

Closed before the requisition is submitted.

●

Changed after the requisition is submitted, and the new line item price is higher than the price at the time of submission.

●

Closed after the requisition is submitted but before it reaches the Ordering or Ordered status.

●

Changed after the requisition is submitted, and the new line item price is the same or lower than the price at the time of submission.

●

Changed after the requisition is approved but before it reaches the Order­ ing or Ordered status, and the new line item price is the same or lower than the price at the time of submission.

Automatically withdraws the requisition.

Attaches the changed (newer) version of the contract to the requisition.

If you have enabled the Demand Aggregation feature on your site, when you submit a requisition, contracts get detached from line items that are held for aggregation. If the price of a held line item increases as a result, a warning message is displayed to inform the user about the reason for the same.

Manual Selection Reevaluation on Contract-based Invoices Contract-based invoices are always created by selecting a contract first, and then adding items from the contract to the invoice. In the typical configuration, after an invoice has been submitted, the invoice is automatically approved and an invoice reconciliation document is created to document any discrepancies, or invoice exceptions, that result from evaluating the information on the invoice against the contract. Only if no invoice exceptions are found, or all invoice exceptions are resolved, can the invoice then be fully approved for payment. If the associated contract is changed or closed before the invoice is fully reconciled and approved for payment, all invoices reconciliation documents associated with the contract are re-reconciled. Depending on the invoice exceptions configured for your site, this might result in new invoice exceptions and new approvers added to the approval flow for exception resolution and approval.

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Topics about blanket purchase orders

What are blanket purchase orders [page 21] Release order BPO process flow [page 22] No-release order BPO process flow [page 22] Restricting suppliers from viewing amount and unit price values in BPOs [page 23]

What are blanket purchase orders  Note This feature is not available in sites configured for SAP Ariba Catalog or SAP Ariba Contract Invoicing only. You create a blanket purchase order (BPO) as an attribute of a contract. BPOs can be release order or no-release order type contracts. Defining a contract as a BPO contract provides additional benefits compared to a non-BPO contract: ● BPOs are sent to suppliers on Ariba Network, where suppliers can view BPOs and their accumulators. NonBPO contracts are not sent to suppliers on Ariba Network. ● If you don’t allow collaborative invoicing, suppliers can invoice against no-release order item level BPOs directly on Ariba Network using purchase order to invoice flip (PO-flip). ● If you allow collaborative invoicing, suppliers can select the BPO (item, commodity, catalog or supplier level contract) in their Inbox on Ariba Network to punch in to your site to start creating the invoice. For non-BPO contracts, suppliers first select the customer on a contract search page, and then punch in to create their invoices. ● Maximum limits are required for BPOs. See About Limits [page 38] for more information. BPOs are identified in the system by a BPO prefix, for example BPO123. See About Ordering, Receiving or Invoicing Against Contracts [page 7] for more information about release order and no-release order contracts.  Note ● A BPO can be a master agreement. If you create a BPO as a subagreement, then its parent must also be a BPO contract. ● If a supplier’s preferred routing method is manual, the BPO status is immediately set to Processed, and the history tab includes a record indicating the reason. You have to either manually deliver a printout of the BPO to the supplier, or implement a supported custom routing for the desired routing method. ● If you create a parent agreement BPO for a supplier configured for manual routing, and you then create a subagreement BPO associated to the parent agreement after this supplier has been enabled on Ariba Network, the subagreement BPO will not be sent to Ariba Network. You will need to deliver the contract to the supplier manually. Managing contract compliance Topics about blanket purchase orders

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● Suppliers can create invoices using PO-Flip® (purchase order to invoice flip) in Ariba Network for no-release order item level BPOs if: ○ Collaborative invoicing is not enabled for your site, or ○ Collaborative invoicing is enabled for your site, but the contract does not allow collaborative invoicing. ● For all no-release order BPOs, if your site is enabled for collaborative invoicing and you allow collaborative invoicing for these BPOs, suppliers punch in to your site to create invoices against these contracts.

Release order BPO process flow The following describes the release order BPO process: 1. The contract agents creates a contract request for a contract of type BPO with the release required options set to Yes. 2. After the contract request has been fully approved, the BPO is created and sent to the supplier on the Ariba Network. This BPO is informational only to track the purchases against the BPO. Invoiced amounts are not accumulated on release order BPOs and are not tracked on the BPO. 3. A purchasing user creates a requisition that includes line items that are associated with the BPO. After the requisition is approved, a purchase order is sent to the supplier on Ariba Network. The order ID includes the BPO ID as a prefix, and the order shows the original BPO as a related document. 4. Suppliers can create order confirmation, ship notices and invoices against the purchase order just as they do with a standard purchase order.

No-release order BPO process flow The following describes the no-release order BPO process: 1. The contract agents creates a contract request for a contract of type BPO with the release required options set to No. 2. After the contract request has been fully approved, the BPO is created and sent to the supplier on the Ariba Network. 3. If the option Allow invoicing against the contract is set to Yes, and you allow collaborative invoicing, then the supplier can punch in to your SAP Ariba invoicing solution to create the invoice. The specific invoicing flow for the supplier depends on your site configuration. See Contract-based invoices in SAP Ariba Invoice Management or SAP Ariba Buying and Invoicing [page 13] for details. If you allow invoicing against the contract but you do not allow collaborative invoicing, then on item level BPOs, suppliers can use purchase order to invoice flip (PO-Flip) to create an invoice. For commodity level, catalog level, or supplier level contracts that do not allow collaborative invoicing, suppliers can create a non-PO invoice with the contract ID to submit the invoice.

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Restricting suppliers from viewing amount and unit price values in BPOs You can restrict suppliers from viewing the Amount, Unit Price, and Quantity field values in blanket purchase orders (BPOs) on the Ariba Network. You can choose to hide these field values individually for each line item or at the header-level (applicable to all line items). Selecting to hide the Amount or Unit Price automatically hides the Quantity field values. The options to hide these fields (at both the header and line-item level) are also available during contract import and export. When suppliers view the BPO in the Inbox on the Ariba Network, the restricted field values are displayed as Undisclosed. The restricted field values are set to zero when the supplier attempts to create an invoice associated with the BPO. The supplier can then edit these values and submit the invoice on the Ariba Network. The functionality provided by this feature is not applicable to scenarios where supplier users punch into SAP Ariba Procurement solutions from Ariba Network to view the BPO details or to create invoices against BPOs. If you want to restrict supplier users from punching into SAP Ariba Procurement solutions, contact your Designated Support Contact and have them log a service request. An SAP Ariba Customer Support representative will follow up to configure your site accordingly

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Topics about contract hierarchies

A contract hierarchy is a set of related contracts that can share accumulated amounts and discounts. When you create a contract request, you specify whether or not it belongs to a hierarchy Contract relationships in contract hierarchies [page 24] Accumulation of contract spend in contract hierarchies [page 26] Compound and override pricing in contract hierarchies [page 27]

Contract relationships in contract hierarchies A contract has one of three hierarchical relationships: ● Standalone agreement, which is not part of a hierarchy. If you want to include a standalone agreement in a hierarchy, you must change it to either a master agreement or subagreement before the contract request has been approved. ● Master agreement, which is the top-most contract in a hierarchy. A master agreement is used to group subagreements together. You can associate subagreements with master agreements that have a contract status of Processed or Open. ● Subagreement, which is a contract associated with a parent contract in a hierarchy. The parent of a subagreement can be a master agreement or another subagreement. A subagreement can have only one parent, but it can have multiple children. For non-BPO type contracts, you can aggregate multiple contracts into a hierarchy in which a parent contract’s terms apply to its children, and each child contract applies to a different supplier. When you define a contract of type blanket purchase order as a subagreement, the supplier on the subagreement must match the supplier on the parent agreement. A parent contract must be of the same level or of a higher level than its child. For example, a supplier level contract can be a parent to any other contract, but an item level contract can be a parent to only another item level contract. The following table lists the possible parent-child relationships in a contract hierarchy: This type of contract...

Can have this type of child...

Supplier level

Supplier level, catalog level, commodity level, or item level

Commodity level

Commodity level, catalog level, or item level

Catalog level

Catalog level or item level

Item level

Item level

The following diagram shows an example of a simple contract hierarchy.

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Accumulation of contract spend in contract hierarchies Contract spend is accumulated from a subagreement to its parent agreement. You can configure a contract to allow, limit, or prevent spend accumulation. To allow accumulation to a parent contract, you set the Include Subagreement Accumulators option for the parent contract to Yes. In a multi-level hierarchy, you can configure spend to accumulate throughout the hierarchy, or only from one level to the next. You can choose the point in the hierarchy at which accumulation ends by setting the accumulation parameters as outlined in the following diagram:

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Compound and override pricing in contract hierarchies Compound pricing A subagreement can compound its price or percentage discount with the percentage discount of its parent agreement. If compound pricing is enabled, the subagreement’s pricing terms are compounded with the applicable parent agreement’s percentage discount. Compound pricing is available only if the parent agreement uses a percentage discount. To compound a subagreement’s pricing terms, choose a parent agreement that uses a percentage discount, and set the Compound with applicable parent’s pricing terms? option in the subagreement to Yes. The compound pricing calculation considers only the current subagreement and applicable contracts above it in the contract hierarchy. These calculations never include contracts below the subagreement. Compounded price discounts are serially calculated within each contract, beginning with the subagreement attached to the release order or selected for invoicing. For example, a supplier level master agreement contract has a discount of 1% and its subagreement has a discount of 2%. If the subagreement item price is $10.95, the compounded price discount is first calculated at the subagreement ($10.95 * 0.98 = $10.731) and then this result is applied to the master agreement ($10.731 * 0.99 = $10.62369).

Override pricing Override pricing requires the use of no-release order contracts within the hierarchy. In the following example, a release order against the subagreement has its price overridden by the applicable parent agreement’s pricing of $9.99.

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Contract request and contract statuses

When you create a contract request, a document with the CR prefix (for example, CR21) is generated. Once the contract request has been approved, a contract, identified by the prefix C (for example, C21), is created from the contract request. The following table describes each contract request status. Status

Description

Composing

A user, generally a contract agent, is composing the CR. CRs that are imported from Microsoft Excel spreadsheet files are created in the Composing status. A CR can return to the Composing status if the purchasing agent withdraws the request.

Submitted

The contract agent has submitted the CR for approval.

Denied

An approver has denied the CR.

Approved

The CR has been fully approved.

SourcingConfirming

Integrated sites only. Contract creation is in process for a contract request associated with a contract workspace.

Processing

Contract creation from the contract request is in process. The CR remains in Processing until its associ­ ated contract moves to Processed.

Processed

A contract has been created from the CR.

After your contract request is fully approved, a contract is created. The following table describes each contract status. Status

Description

Created

The contract has been created from the contract request.

Processing

A transitory state to indicate that the SAP Ariba solution is generating and loading subscriptions for non-cata­ log items. Subscriptions are generated for all non-catalog items in no-release order contracts. For release or­ der contracts, subscriptions are only generated if Create subscription for non-catalog items is set to Yes on the contract.For more information on contract subscriptions, see How to define general contract information [page 52].

Sending

For BPOs only. Indicates that the BPO contract is sent to Ariba Network. When the BPO is fully processed on Ariba Network, the status of the contract moves to Processed.

Processed

Depending on your configuration, if a subscription was generated for non-catalog items in the contract, the status changes to Processed: ●

After the subscription has been successfully loaded, if your site is configured to change the contract sta­ tus after the subscription is fully loaded. If the subscription cannot be loaded, the status remains Process­ ing.

●

Without waiting for the subscription to load, if your site is configured to immediately transition the con­ tract status to Processed. For more information on contract subscriptions, see How to define general con­ tract information [page 52].

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Status

Description

Open

The contract status moves to Open when: ●

the current date is between the contract’s effective and expiration dates, and the contract has a valid available amount.

●

the contract’s effective date has been reached.

●

as a contract manager, you open the contract manually with the Open command. If you are using SAP Ariba Contractst, the contract is opened when the associated contract workspace is published. Your SAP Ariba solution activates subscriptions, if applicable, for non-catalog items when a contract is opened. For more information on contract subscriptions, see How to define general contract information [page 52].

Received

This status applies only to no-release order contracts that allow receiving against the contract. The contract status moves to Received when the contract has been fully received (but not fully invoiced if in­ voicing against the contract is allowed).

Invoiced

This status applies only to no-release order contracts that allow invoicing against the contract. The contract status moves to Invoiced when the contract has been fully invoiced. (but not fully received if re­ ceiving against the contract is allowed).

Inactive

This status applies only to no-release order contracts. The contract status moves to Inactive when the contract expiration date has been reached, but the contract maximum spend limit has not been reached. Users can continue to invoice or receive against the contract until the maximum spend limit is reached and the contract is closed automatically, or the contract is closed man­ ually.

Closed

The contract moves to the Closed status when: ●

a release order contract reaches its contract expiration date.

●

a no-release order contract has been fully received and invoiced.

●

you close the contract manually with the Close command.

For release order contracts, the contract is also closed when: ●

the maximum commitment, including tolerance, has been reached. For more information, see Overall con­

●

the maximum quantity or amount, including tolerances, has been reached for all the contract’s individual

tract limits [page 39]. pricing terms. For more information, see Topics about contract limits and limit enforcement [page 38]. 

Note

If you do not want the contract to be closed automatically when the maximum limits have been reached, contact your Designated Support Contact and have them log a service request. An SAP Ariba Customer Support representative will follow up to configure your site accordingly. For no-release order contracts that can be invoiced or received against, the contract is closed and contract subscriptions are deactivated when it is fully invoiced (invoices have been reconciled and the IRs have been approved) and/or fully received or if it is closed manually. If a contract has expired, contract subscriptions will not be deactivated until the contract is fully received and/or fully invoiced or closed manually. For release order contracts, contract subscriptions are deactivated when the contract expires or is closed.

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Purchasing unit filtering in contracts

 Note This feature is not applicable to sites configured for SAP Ariba Catalog only. Your site can be enabled for enhanced purchasing unit filtering to support selection of the best contract terms during requisitioning or invoicing within a business hierarchy and enhanced selection of parent agreements during subagreement creation. This feature allows you to create contracts at purchasing unit level that also apply to child purchasing units, which means you can create contracts to reflect the specific requirements of the purchasing unit and the business environment it operates in. For example, you can create a contract at country level (parent purchasing unit) that applies to all plants (child purchasing units) in that county. But a plant might have negotiated another contract with the same supplier for better terms, in which case that plant’s contract will be used. When you create a subagreement, contracts matching the purchasing unit for which you are creating the subagreement and all contracts of that unit’s parent purchasing units will be displayed.  Note You can only create contracts for purchasing units for which you are responsible.

Example: Consider the following purchasing unit hierarchy, where the European subsidiary is organized by region, countries and plants. Contracts exist for Western Europe, Eastern Europe, UK and Plant1.

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In this example, the contracts are applied as follows: ● Plant 1 will have access to all three contracts: C1 (its own contract), and C2 and C3 (contracts specified for the parent purchasing units which applies to all children). ● Plant 2 and UK will have access to contracts C2 and C3. ● Plant 3, Plant 4, France, Germany, and Western Europe will have access to contracts C3. ● Plant 5, Plant 6, Poland, Czech, and Eastern Europe will have access to contracts C4. This feature is enabled by default for sites that are also enabled for Visibility Control. If you do not use Visibility Control, then enhanced purchase unit filtering of contract requests is not available to you. If your site is configured for Visibility Control, and you do not want to use enhanced purchase unit filtering of contracts, contact SAP Ariba Customer Support to have it disabled. See the Common Data Import and Administration Guide for more information about Visibility Control.

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Effective and expiration dates in contracts

When your create a contract, you must specify the effective date and the expiration date. An expiration date is optional if you are creating an evergreen contract. To create a contract that will not expire on a specific date, set the Evergreen option to Yes. A contract is opened automatically when it reaches its effective date, and it is closed (release-order contracts) or set to Inactive (no-release order contracts) when it reaches its expiration date (if it is not an evergreen contract). You can specify an expiration date for an evergreen contract, but in this case, it represents a key date related to the contract, for example, when its terms must be reviewed. This expiration date can be used in conjunction with a notification limit to produce notification messages. For no-release order contracts that allow receiving, users can continue to submit receipts against the contract as long as the service date for the receipt is on or before the contract’s expiration date. For no-release order contracts that allow invoicing, users can continue to submit invoices past the contract’s expiration date, but the submissions might be subject to invoice reconciliation exception rules. You will receive a notification message when a contract is about to expire. When you create a contract, you configure how many days before the contract’s expiration to send this notification message. You can set up a similar notification message for an evergreen contract by specifying a date in the Expiration Date field. For more information on these notification messages, see Notification Limits [page 43]. In SAP Ariba Contracts, you can specify fixed, auto-renew and perpetual contract term types for your contract workspace. If SAP Ariba Procurement solutions are integrated with SAP Ariba Contracts, a fixed contract term type creates a contract request with a specified expiration date. A contract term type auto-renew in SAP Ariba Contracts is treated as not evergreen . When the contract is renewed in SAP Ariba Contracts, the contract request’s expiration date is automatically extended. A contract term type of perpetual creates an evergreen contract request in SAP Ariba Procurement solutions. See the Project attribute fields topic for more information on contract term types.

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Accounting information on contracts

You can provide accounting information for each line item in a contract if you want to prefill certain accounting values on the release order from the contract. You enter accounting information on the pricing terms page for each contract line item you create. Contract accounting information is optional for release order contracts and no-release order contracts that allow invoicing. Accounting information is required for no-release order contracts that allow receiving.  Note This feature is not applicable to sites configured for SAP Ariba Catalog only. When you create a release order or a contract-based invoice, the accounting information on the release order or invoice line item is set to the accounting information from the contract line item. If required, you can override the accounting information on the release order or invoice. All manual changes to the accounting details are retained irrespective of any other changes made to the line items. If you enter accounting information for a release order contract or no-release order contract with invoicing allowed, accounting values are inherited as follows: ● All values except Cost Center are inherited by the release order line item. Cost Center is defaulted to the value configured for the user who creates the release order. ● All values including Cost Center are inherited by the invoice line items.

Related Information Accounting information defaulting on contracts [page 34] Accounting field defaulting on release orders against contracts [page 35] Accounting defaulting behavior on contract-based invoices [page 37]

Accounting information defaulting on contracts During a contract request creation, the accounting details are blank by default. To fill in the accounting details, click Fill Values. When you click Fill Values, the following accounting fields are defaulted based on the accounting information configuration set up for your site. If matching entries are not found, the values are defaulted from the requester’s user profile. Simple Generic

PeopleSoft

SAP (Splittable Fields)

Cost Center

GL Business Unit

Asset Number

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Simple Generic

PeopleSoft

SAP (Splittable Fields)

Business Unit

Location

GL Account

Company

Account

Internal Order

Account

Department

Cost Center

Sub Account

Statistics Code

Project/WBS

Project

Product

Account Assignment (non-splittable)

Product (if available)

Item Category (non-splittable)

Region (if available)

Accounting field defaulting on release orders against contracts When a release order is created against a contract, certain accounting fields are inherited from the contract, and certain accounting fields values are defaulted from the accounting information configuration set up for your site or the requester's user profile file. The following splittable accounting fields are defaulted from the contract line to the requisition line: Simple Generic

PeopleSoft

SAP

Business Unit

Location

Asset Number

Company

Account

GL Account

Account

Statistics Code

Internal Order

Sub Account

Product

Project/WBS

Project

The following accounting fields and shipping details are not defaulted from contract, but they are defaulted from the accounting information configuration or the requester’s profile: PeopleSoft

SAP

Cost Center (split line)

Department (split line)

Cost Center (split line)

Account Type

Account Type

Account Type

GL Business Unit (split line)

Account Assignment

Simple Generic Accounting Details

Item Category Shipping Information Ship To

Ship To

Plant

Deliver To

Deliver To

Deliver To

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 Note If you want the Cost Center (for Simple Generic and SAP ERPs) and Department (for PeopleSoft ERP) values to be defaulted from the contract to release orders, contact your Designated Support Contact and have them log a service request. An SAP Ariba Customer Support representative will follow up to configure your site accordingly.  Note For all release orders on the PeopleSoft ERP, the GL Business Unit value is defaulted from the requisition’s Business Unit (header field). If the On Behalf Of field on the requisition is changed, or the Business Unit at the requisition header is changed manually, your SAP Ariba Buying solutions automatically re-defaults the GL Business Unit that is associated with the changed Business Unit to all existing requisition lines as well as any new lines that are added.

Defaulting Example A release order contract line has been defined with the following accounting values: Accounting Fields

Default Values

Overridden to... on contract request

Business Unit

US005

BUY01

Company

USOPS

Account

Misc (Expenses)

SubAccount

Research and Development

Project

SIMM

Blank Value

On the requisition line associated with this release order contract, the accounting details are inherited as follows: Accounting Fields

Inherited Values

Business Unit

BUY01 (manual change is retained)

Company

USOPS

Account

The blank value is replaced with an appropriate entry from the accounting information configuration set up for your site or the requester's user profile.

SubAccount

Research and Development

Project

SIMM

Accounting Defaulting When a Release Order is Edited After the initial defaulting of accounting details, if the amount or quantity of the requisition line is changed, your SAP Ariba Buying solutions re-defaults the Account Type only, based on the matching entry from the accounting information configuration set up for your site.

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All other accounting details (automatically defaulted as well as manually specified) on the requisition line are retained.

Accounting defaulting behavior on contract-based invoices Accounting details are defaulted on contract-based invoices as follows: ● If the associated contract line items include accounting details, then the invoice line items inherit the accounting information from the contract line item. ● If the associated contract line item does not include accounting details, then the accounting details on the invoice line item is defaulted from the accounting information configuration set up for your site or the requester's user profile information. ● If header-level charges (shipping, handling, or tax) are added to a contact-based invoice, the accounting details are defaulted from the first line of the associated contract. ● If line-level charges are added, the accounting details are inherited from the associated invoice line.

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Topics about contract limits and limit enforcement

Contract limits [page 38] Minimum and maximum contract limit enforcement on release orders [page 39] Notification limits [page 43]

Contract limits  Note Limits are not supported in sites configured for SAP Ariba Contract Invoicing. Contract limits allow you to enforce certain contractual commitments. Limits can be used to define a minimum expected threshold for the contract or a maximum commitment that cannot be exceeded. You can set limits for the overall contract or for line items. For release order contracts, you can also control limits per release order. Limits for release order contracts are enforced during the ordering process. Depending on the type of limit and your site’s enabled features, purchasing users who either select a catalog item associated with a contract or who directly create a release order against the contract will experience the following: ● Users receive a warning message but are not prevented from ordering the item(s). In SAP Ariba Buying or SAP Ariba Buying and Invoicing, additional approval nodes are added to the requisition. ● Users receive an error message and are prevented from adding their item to the order or shopping cart. ● SAP Ariba Buying and SAP Ariba Buying and Invoicing: Users don’t receive an error or warning message, but additional approval nodes are added to the requisition. For no-release order contracts, limits are enforced during invoice reconciliation as invoice exceptions. No enforcement happens during invoicing. See Release Limits [page 39] for detailed information on enforcement by limit level. Limits can be hard limits or soft limits, and maximum limits can include tolerances. In SAP Ariba Buying and SAP Ariba Buying and Invoicing, if the order value exceeds the limit but is still within the tolerance percentage, additional approvers are added to the requisition as watchers. Accumulators keep track of the amounts released from or invoiced against contracts. Pre-loaded amounts are included in a contract’s accumulated amounts. For information on these accumulators, see Contract Accumulators [page 44]. See the following sections for more information: ● Overall Contract Limit [page 39] ● Overall Line Item Limits [page 39] ● Release Limits [page 39]

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● Notification Limits [page 43]

Overall contract limits Overall limits are limits that apply to the entire contract. You can define overall line item limits for item level contracts, catalog level contracts, commodity level, and supplier level contracts. If an overall contract maximum limit has been reached, the contract is automatically closed for further releases or invoices. When a contract hierarchy exists, you configure values per contract and your SAP Ariba solution enforces this limit per contract. The maximum commitment value for a single subagreement cannot exceed the maximum commitment value for its master agreement, but if a master agreement has multiple subagreements, the sum of the maximum commitment values for its subagreements can exceed the master agreement’s maximum commitment value. You will receive notification messages when a contract is approaching its maximum commitment. When you create a contract, you can configure the percentage of the maximum commitment that must be reached before sending this notification message. For more information, see Notification Limits [page 43]. You define overall contract limits on the Limits page.

Overall Line Item Limits In addition to overall contract limits, you can set overall limits on line item level. For example, you might have an overall contract limit of 500,000 USD for five items, but you only allow up to 100,000 USD for each item on the contract. For material and services items, the limit can be amount or quantity based. If an overall maximum line item limit has been reached, the line item is no longer available for further releases or invoices. If the overall line item maximum limits have been reached for all line items on a contract, the contract is closed. You can define overall line item limits for item level contracts, catalog level contracts and commodity level contracts. For item level contracts, overall line item limits apply to each specific item. For catalog level contracts, overall line item limits apply to all items from each catalog subscription. For commodity level contracts, overall line item limits apply to each commodity code. You define overall line item limits on the Pricing Terms page.

Minimum and maximum contract limit enforcement on release orders Release limits only apply to release order contracts. They specify the minimum and maximum amounts or quantities allowed with each order. Managing contract compliance Topics about contract limits and limit enforcement

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You can define release limits on contract level to control the overall minimum required or maximum allowed order amount or quantity (for material and services items) of all contract items included in the order. For item level, catalog level and commodity level contracts, you can also set release limits for each line item. For example, if you want to enforce that users always purchase a minimum quantity for a particular item to ensure the best pricing, you can configure the contract so that any requisition or shopping cart where the minimum item quantity is not met is rejected. You define contract release limits on the Limits page, and line level release limits on the Pricing Terms page.

Minimum limit enforcement

Minimum limits can be defined as either hard or soft limits depending on the level (overall contract, line item or release level). Minimum limits are enforced for release order contracts only. The following table shows detailed enforcement information for minimum limits: Minimum limit set for ...

Minimum limit is ...

Overall Contract

Not enforced, but notifications can be sent if minimum commitments are not met and the con­ tract expiration date is approaching.

Overall Line Item

Not enforced, information only.

Contract per Release (Applies to Release Order Contracts Only)

Enforced. Can be defined as hard or soft limit. ●

Soft Minimum Limits In SAP Ariba Buying and SAP Ariba Buying and Invoicing, when a soft minimum limit is not

Line Item per Release (Applies

met, users receive a warning message and additional approvers based on the default ap­

to Release Order Contracts

prover list defined on the contract are added to the requisition as approvers. If the default

Only)

approver list is empty, the Contract Manager and Purchasing Agent groups are added. External users punching in to an SAP Ariba Catalog site receive a warning message, but are not prevented from checking out the shopping cart. ●

Hard Minimum Limits If a hard minimum limit is not met, users are prevented to submit their requisition or shop­ ping cart until they change the item quantity or amount to meet the hard minimum order limit.

Maximum limit enforcement

Depending on where a maximum limit is defined, maximum limits can be defined as either hard or soft limits including tolerances. See the following sections for details on how a maximum limit is enforced depending on the release type of contract and the features enabled for your site: ● Maximum limit enforcement during ordering [page 41] ● Maximum limit enforcement in SAP Ariba Catalog [page 42] ● Maximum limit enforcement on contract-based invoices [page 42]

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Maximum limit enforcement during ordering in SAP Ariba Buying and SAP Ariba Buying and Invoicing The following table describes how maximum limits are enforcement for users that place orders in SAP Ariba Buying or SAP Ariba Buying and Invoicing: Maximum limit set for ...

Maximum limit is ...

Overall Contract

Enforced. Can be defined as hard or soft limit and include a tolerance percentage for hard limit. If the amount on the requisition exceeds the available funds for the contract, the limits are en­ forced as follows: For a soft limit, if the amount on the requisition exceeds the maximum limit (regardless of toler­ ance configuration), additional approvers are added to the release order for approval. For a hard limit, if the amount on the requisition exceeds the hard maximum limit plus toler­ ance: ●

If purchasing users have release access to a contract and they manually select only items from that contract, the user cannot submit the requisition.

●

If purchasing users have release access to a contract and they manually select items from that contract and they also add additional items that are not covered by the contract, they can submit the requisition, but will receive a warning message and additional approvers are added to the approval flow.

●

If purchasing users select items from the catalog with an associated contract, they can submit the requisition, but will receive a warning message and additional approvers are added to the approval flow. For a hard limit, if the amount on the release order exceeds the hard maximum limit but is within the tolerance range, additional approvers are added to the approval flow as approv­ ers. If you want to prevent users from submitting requisitions that exceed the configured hard maximum limits, contact your Designated Support Contact and have them log a service request. An SAP Ariba Customer Support representative will follow up to configure your site accordingly.

Overall Line Item

Enforced. Can include a tolerance percentage for maximum limit. If the amount or quantity on the requisition exceed the available funds for the line item including the tolerance, additional approvers are added to the requisition.

Contract per Release

Enforced. Can be defined as hard or soft limit and include tolerance percentages. If the amount or quantity on the requisition exceed a maximum hard limit including the tolerance percentage, users cannot submit the requisition. If either a maximum soft limit including the tolerance per­ centage or a hard limit excluding the tolerance has been exceeded, users receive a warning message and additional approvers are added to the approval flow. If a soft limit excluding the tolerance has been exceeded, additional watchers are added to the approval flow.

Line Item per Release

Enforced. Can be defined as hard or soft limit and include tolerance percentages. If the amount or quantity on the requisition exceed a maximum hard limit including the tolerance percentage, users cannot submit the requisition. If either a maximum soft limit including the tolerance per­ centage or a hard limit excluding the tolerance has been exceeded, users receive a warning message and additional approvers are added to the approval flow. If a soft limit excluding the tolerance has been exceeded, additional watchers are added to the approval flow.

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Maximum limit enforcement in SAP Ariba Catalog The following table describes how maximum limits are enforced for external users that punch in from an external ERP purchasing system to SAP Ariba Catalog to order items from the catalog: Maximum limit set for ...

Maximum limit is ...

Overall Contract

Enforced. Can be defined as hard or soft limit and include a tolerance percentage for hard limit, but exceeding a soft limit or a hard limit that is within the tolerance percentage does not trigger a warning message to users and users are not prevented from checking out the shopping cart. If the amount exceeds the hard maximum limit plus tolerance: ●

If purchasing users have release access to a contract and they manually selects only items from that contract, the user cannot check out the shopping cart.

●

If purchasing users have release access to a contract and they manually select items from that contract and also adds additional items that are not covered by the contract, they can check out the shopping cart, but will receive a warning message that the hard maximum limit for the contract has been exceeded.

●

If purchasing users select items from the catalog with an associated contract, they can check out the shopping cart, but will receive a warning message that the hard maximum limit for the contract has been exceeded.

Overall Line Item

Not enforced. Only used to determine if an item is available for release or not.

Contract per Release

Enforced. Can be defined as hard or soft limit and include tolerance percentages. If the amount or quantity on the shopping cart exceeds a maximum hard limit including the tolerance per­ centage, users cannot check out the shopping cart. If a soft limit including the tolerance has been exceeded, users receive a warning message but are not prevented from checking out the shopping cart. If the amount or quantity on the shopping cart exceeds the limit but is below the limit plus tolerance, users can check out and no message is sent.

Line Item per Release

Enforced. Can be defined as hard or soft limit and include tolerance percentages. If the amount or quantity on the shopping cart exceeds a maximum hard limit including the tolerance per­ centage, users cannot check out the shopping cart. If a soft limit including the tolerance has been exceeded, users receive a warning message but are not prevented from checking out the shopping cart. If the amount or quantity on the shopping cart exceeds the limit but is below the limit plus tolerance, users can check out and no message is sent.

Maximum limit enforcement on contract-based invoices For no-release order contracts, maximum limits are enforced during invoice reconciliation. The tolerance setting on the contract determines if an invoice will trigger an exception or not. Suppose a contract of USD 10,000.00 has a percentage tolerance of 2%. If the invoice line amount is for USD 10,150.00, the invoice is accepted because the amount is within the allowable contract tolerance limit. If the contract line item variance invoice exception is configured for an absolute variance tolerance of 100, and the contract tolerance limit is a soft limit, then only invoice line item amount values greater than 10,300 will trigger an exception. In effect, the allowable tolerance values of the contract and the invoice exception are combined to determine the maximum allowable amount that does not trigger an invoice exception. If the contract limit is defined as a hard limit, the tolerance defined for the invoice exception is disregarded. In this example, any invoice amount over USD 10,200.00 will trigger an invoice exception.

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Notification limits You can configure triggers to generate notification messages when a contract is approaching its maximum limit, when a contract commitment minimum level has not been met, when it is about to expire, and if the expiration notice recurs. These notifications are emailed automatically to the contract requester and to users with edit access to the contract. You can add additional users to the notification list when creating the contract. You can specify an available balance percentage (a percentage of the contract's maximum commitment) that when reached will cause the Contract Approaching Limit notification message to be sent. You can configure how many days before the contract’s expiration date the Contract Approaching Expiration notification message is sent. For an evergreen contract with an expiration date, use this field to specify how many days before that date you want to send the Evergreen Contract Approaching Notification Date notification message. If either notification message is enabled, you can specify the interval (in days) at which you want the message to recur. Use the Number of Days Before Next Notification field. A notification message can also be generated when a milestone item is approaching its completion date. See How to create a milestone for a contract [page 60]for more information on milestones.

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Topics about contract accumulators

Contract accumulators keep track of the amount and quantities ordered, received, or invoiced on a contract. Accumulators are checked against defined contract limits to trigger certain actions such as automatically closing contracts, adding approvers to release orders or invoices, or sending notifications for upcoming actions. Contract accumulators [page 44] Preload Amounts [page 46] Accumulator updates [page 47]

Contract accumulators SAP Ariba Procurement solutions maintain accumulators that track the quantities and amounts of the items users ordered, received or invoiced against contracts. There are two types of accumulators: ● Overall Contract Accumulators [page 44] ● Pricing Term Accumulators [page 45]  Note The available accumulators depend on your enabled features. For example, in sites configured for SAP Ariba Catalog only, there are no invoice or receiving related accumulators. In sites configured for SAP Ariba Contract Invoicing, accumulation is not supported.

Overall Contract Accumulators

Overall contract accumulators apply to an entire contract. If a contract belongs to a hierarchy, the overall contract accumulators include the rolled-up spend amounts for the contract’s subagreements if those subagreements are configured to accumulate these amounts. For more information, see Accumulation of Contract Spend [page 26]. The following table describes the overall contract accumulators. Accumulator

Description

Used Amount

The monetary amount that represents the current total amount of all purchases, receipts or invoi­ ces applied against the contract. For item level, catalog level and commodity level contracts, the Used Amount represents the collective total of all the pricing terms covered by the agreement.

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Accumulator

Description

Available Amount

The monetary amount currently available for subsequent purchases, receipts or invoices. This value is calculated by subtracting the current total amount of all purchases, receipts or invoices ap­ plied against the contract (the Used Amount) from the contract’s maximum limit amount. For item level, catalog level and commodity level contracts, the Available Amount represents the collective total of all the pricing terms covered by the agreement. When the contract is initially created, the Available Amount is set to the maximum limit amount minus any preload amount, if specified.

Cumulative Pricing Used Amount

The monetary amount used to calculate cumulative tiered pricing discounts for orders or invoices applied against the contract, based on the current total amount of all orders or invoices applied against the contract (the Used Amount).

Amount Received

The cumulative amount of goods or services received for all line items on the contract.

Amount Invoiced

The cumulative amount of goods or services invoiced and the cumuluative amount of goods or services reconciled for all line items on the contract.

Amount Reconciled



Note

By default, the total invoiced and reconciled amount accumulators includes taxes and charges. If enabled for your site, you can specify whether the invoiced and reconciled available amount and maximum limit amount include or exclude taxes and charges on the Limits page when defining a no-release order contract. The feature to change the invoiced amount accumulation on contracts is disabled by default and requires SAP Ariba to enable it. Amount Limit Less Invoiced Amount

This value is calculated by subtracting the current total amount of all invoices applied against the contract from the contract’s maximum commitment amount.

Amount Limit Less Recon­ ciled Amount

This value is calculated by subtracting the current total amount of all invoices applied against the contract that have been reconciled from the contract’s maximum commitment amount.

Pricing Term Accumulators

Item level accumulators are maintained for each item level pricing term on an item level contract. If a contract belongs to a contract hierarchy, the item level accumulators will include the rolled-up spend from all subagreements that have compounded prices with this contract. For more information, see Compound Pricing [page 27]. Similarly, commodity level accumulators are maintained for each commodity level pricing term on a commodity level contract and catalog level accumulators are maintained for each catalog level pricing term on a catalog level contract. The following table describes the item level and commodity level accumulators. Accumulator

Description

Used Amount

The cumulative monetary amount applied toward an individual pricing term. This accumulator is used for catalog and commodity level pricing terms and item level pricing terms with amount based limits.

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Accumulator

Description

Available Amount

The difference between the Used Amount and the specified maximum amount for an individual pricing term. This accumulator is used for catalog and commodity level pricing terms and item level pricing terms with amount based limits.

Used Quantity

The cumulative quantity applied toward an individual item level pricing term. This accumulator is used only for item level pricing terms with quantity-based limits.

Available Quantity

The difference between the Used Quantity and the specified maximum quantity for an individ­ ual pricing term. This accumulator is used only for item level pricing terms with quantity-based limits.

Cumulative Pricing Used Amount

The monetary amount used to calculate cumulative-tiered pricing discounts for an item, cata­ log, or commodity level pricing term with amount-based limits.

Cumulative Pricing Used Quantity

The quantity used to calculate cumulative-tiered pricing discounts for an item level pricing term with quantity-based limits.

Quantity Invoiced

The cumulative quantity of goods or services invoiced against the line item. This accumulator is used only for item level pricing terms with quantity-based limits.

Quantity Reconciled

The cumulative quantity of goods or services reconciled against the line item. This accumulator is used only for item level pricing terms with quantity-based limits.

Amount Limit Less Invoiced Amount

This value is calculated by subtracting the current total amount of all invoices applied against the line item from the line item amount limit. This accumulator is used for catalog and com­ modity level pricing terms and item level pricing terms with amount-based limits.

Amount Limit Less Reconciled Amount

This value is calculated by subtracting the current total amount of all invoices applied against the line item that have been reconciled and the line item amount limit. This accumulator is used for catalog and commodity level pricing terms and item level pricing terms with amount-based limits.

Quantity Limit Less Invoiced Quantity

This value is calculated by subtracting the current total quantity of all invoices applied against the line item from the line item quantity limit. This accumulator is used only for item level pric­ ing terms with quantity-based limits.

Quantity Limit Less Reconciled This value is calculated by subtracting the current total quantity of all invoices applied against Quantity the line item that have reconciled from the line item quantity limit. This accumulator is used only for item level pricing terms with quantity-based limits.

 Note When the tolerance is exceeded for a non-catalog item on a contract, the subscription for the item is reloaded, and the item no longer appears when you search the catalog.

Preload Amounts Preload amounts allow you to enter amount values that were originally outside the applicable contract. Preloaded amounts are accumulated as contract spend and can affect pricing terms. One use for preloading an amount into a contract is to account for previous purchases. A preload amount is tracked at the contract-header level, which prevents the preload amount from being systematically allocated. For supplier level contracts, preload amounts affect the accumulation of any price discounts because supplier level contracts have only one line item. However, item level, commodity level, and

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catalog level contracts allocate the preloaded amount only to the contract-header level and not to the individual line items, and so preload amounts for these contract types never affect their item pricing. Preload amounts are included in calculating tier-based pricing only in supplier level contracts; otherwise, preload amounts are not included in a contract’s accumulated amounts. A preload amount in a supplier level subagreement within a contract hierarchy is accumulated to any parent agreements that are set to include subagreement values.

Accumulator updates On release order contracts in SAP Ariba Buying and SAP Ariba Buying and Invoicing

If a release order applied to a contract is subsequently canceled or changed, your SAP Ariba Buying solution automatically adjusts the accumulators to reflect the remaining available amounts or quantities, even if the contract status is Closed. If a contract is changed after a release order is sent to the supplier, the accumulators are adjusted on both the original contract and on the changed (newer) contract, thus ensuring that all versions of the contract are updated at that same time.

On no-release order contracts

In contracts for which invoicing is enabled, invoicing-related accumulators are updated when invoice reconciliation documents are approved. This also applies to the Used Amount accumulator amounts in a contract hierarchy that contains any contract that has invoicing enabled. An invoice amount is not rolled up to a parent agreement until the invoice is fully reconciled, even if the parent is not using invoices. In contracts for which receiving is enabled, receiving-related accumulators are updated when receipts are processed. By default, receipts are processed once daily starting at midnight.

On contracts in SAP Ariba Catalog

Contract accumulators are updated when the shopping cart is checked out and you return the shopping cart to your external application. Since SAP Ariba Catalog has no knowledge if any of the purchases were denied in your external system, the accumulated amounts and quantities on the contract may not reflect your actual amount spend on the contract.

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Contract request import using Microsoft Excel

You can import data from Microsoft Excel spreadsheets, which are a common way of representing contracts and pricing information, to create or update contract requests. The recommended method of creating a contract with an Excel spreadsheet is to: 1. Export an existing contract or a contract request that has been partially configured to reflect the basic structure you want into an Excel file. See How to export contracts [page 64] for information on how to export contract requests. 2. Change the Excel spreadsheet data. 3. Upload the finished Excel spreadsheet file. See How to upload an Excel version of a contract [page 52] for information on how to import Excel based contract requests.  Note Exporting and importing of contracts with two-dimensional matrix formula pricing is not supported. This section also describes the general worksheet column and field name mappings in the default configuration. For information about how to export and import Excel spreadsheets, see About Creating and Managing Contracts [page 50]

Sample Microsoft Excel spreadsheets Your SAP Ariba solution provides several sample Microsoft Excel spreadsheets as starting points for creating new CRs. The sample worksheets are located along with the documentation in the help center. Each sample spreadsheet defines one CR. (The help center is available by clicking the Help Center link on each page.) Each worksheet defines the contract data that can be imported or exported. In the default configuration, the following data is defined, depending on the worksheet: ● Attachments ● Contract Header ● Contract Item Information ● Accounting ● Filters Formula Pricing ● Filters Formula Pricing Grids ● Header Attachments ● Header Attributes ● Item Attachments ● Item Attributes ● Item Pricing Filters ● Tiered Pricing

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Managing contract compliance Contract request import using Microsoft Excel

Spreadsheet Import Notes Important notes to consider when importing Excel spreadsheets: ● You cannot import formula pricing terms for non-catalog items. ● You cannot import two-dimensional formula pricing definitions. ● If the imported spreadsheet does not contain a Buyer Contract ID (in the Contract Header worksheet), a new CR is created. ● You can only import a spreadsheet to create new contracts or to modify existing contracts that are in Composing state. ● The maximum number of line items you can import is 1,000. ● If the imported spreadsheet contains a Buyer Contract ID and no new version exists for the contract request, the spreadsheet completely replaces the existing CR. ● If the original CR has been changed and a new version exists (in Composing state), a spreadsheet import does not allow changes to the following fields: ○ On the Contract Header tab: Supplier, Contract Type, Release Required, Allow invoicing against contract, Allow receiving against contract, Currency ○ On the Contract Item Information tab: Full Description, Supplier, Supplier Part Number, Supplier Auxiliary Part ID, Unit of Measure, Unit Price (for catalog items) ● When creating contract line items from a catalog in the user interface, the visibility of catalog items can be controlled based on purchasing unit filtering of suppliers or catalog view constraints. This prevents users from adding items to a contract they are not allowed to add. However, when users import a contract request and the contract Excel spreadsheet includes such items, that contract is processed successfully. ● When exporting a contract request, depending on the client’s time zone, the Effective Date and Expiration Date in the export file might be set to a different date than is displayed in the client UI. During export, Effective Date and Expiration Date are set to the start of the day (e.g. Aug 30 00:00) and then recalculated to the server’s time zone, which is Pacific Standard Time. When the file is imported, the Effective Date and Expiration Date are recalculated from the server’s time stamp to the client’s time zone.

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Topics about creating and managing contracts

Define general contract information, contract limits, the type of contract and the release requirement, and how to import or export contracts. How to create a contract [page 50] How to define general contract information [page 52] How to define contract limits, notification recipients, and forecasting [page 57] How to create a milestone for a contract [page 60] How to control edit and release access for contracts [page 61] How to define payment terms in contracts [page 63] How to add attachments to contracts [page 64] How to export contracts [page 64] How to create a contract for autogenerating requisitions [page 66] Topics about managing contracts [page 67]

How to create a contract You can create a new contract from scratch using the contract wizard, copy an existing contract, or upload an Excel version of a contract. The contract wizard fields change depending upon the type of contract you are creating, and the type of ERP system you are using. Your organizational and accounting information depends on your integration with your ERP system, and is not described in detail in this guide. Field labels may be different depending on your ERP system, in the SAP variant, for example, suppliers are referred to as vendors. The contract wizard provides a structured workflow on how to set up your contract, however, you can fill in the pages in any sequence. Keep in mind that certain pages require input from previous pages, so following the contract wizard and entering values for all required fields in the suggested order ensures you don’t have to jump back and forth between pages to fill in missing fields. When you are finished setting up your contract, you you use the Summary page, which shows all the contract properties you configured on the previous pages, to review your contract information before you submit it for approval. You can scroll down theSummary tab to see the properties, or click any of the other tabs to see those properties. You can also modify any property from the Summary page. You must be a member of the Contract Agent, Contract Manager, Procurement Agent, or Procurement Manager group to create contracts.

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Related Information

How to create a new contract using the contract wizard [page 51] How to copy a contract [page 51] How to upload an Excel Version of a contract [page 52]

How to create a new contract using the contract wizard Procedure

1. Log into your SAP Ariba solution. 2. On the dashboard, click

Create

Contract Request .

3. Under What would you like to create?, click Contract Request. 4. Start defining your contract header details, or click a link in the contract wizard to move to a different page.  Note Depending on your site configuration and the choices you make as you move through the wizard, you might not encounter certain fields or certain pages. For example, in sites configured for SAP Ariba Catalog only, you cannot enter any accounting fields and the Milestones and Payment Terms pages are not available.

How to copy a contract Context

You can copy an existing contract in order to take advantage of having the bulk of the contract already configured. If you make a copy of a contract and make any changes to the supplier, the pricing terms for the contract are lost since they are supplier-depenedent. When you change supplier information you must provide new pricing terms for the contract.

Procedure

1. In the My Documents content item, click the ID for the contract . 2. Click Copy. 3. Make any necessary changes to the contract, then submit it for approval. Managing contract compliance Topics about creating and managing contracts

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How to upload an Excel version of a contract Context If you have a contract defined in an Excel spreadsheet, you can upload it to create a new contract. SAP Ariba recommends that you first create a contract template, export it, and use this as the template to build up your contract details for import. Users who are members of both the Customer Administrator group and the Contract Terms Bulk Import Admin group can perform bulk import operations to import sets of contracts put together as Microsoft Excel workbooks in a ZIP file format. See the Common data import and administration guide for SAP Ariba Procurement solutions for more information. Your site can be configured to prevent that imported accounting field values (including the Ship To and Bill To values) are overridden by default accounting fields defined for your site by marking them as set by the user. After the fields have been marked as set by the user during contract import, edits or changes to the imported contract do not affect the imported accounting fields, and the originally imported values are retained even if the values specified by the account defaulting behavior are different. To configure this behavior, contact your Designated Support Contact and have them log a service request. An SAP Ariba Customer Support representative will follow up to configure your site accordingly.  Note Importing of contracts with two-dimensional matrix formula pricing is not supported.

Procedure

1. On the dashboard, click

Create

Contract Request .

2. Under What would you like to create?, click Upload Contract Request. 3. Click Browse to locate the file. Once you have identified the path to the file, click OK. The imported contract is displayed on the Summary page of the contract wizard. 4. Make any necessary modifications using the contract wizard, then return to the Summary page. 5. Click Submit.

How to define general contract information Context Use the contract Definitions page to enter information such as a title and description, and to set options for the contract like the effective and expiration dates, and whether to allow accumulation of spend.

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Procedure 1. Start the contract wizard [page 51]. 2. On the Definitions page, enter the following information: For this option...

Do this...

Title

Enter a title for the contract.

Description

Enter a description of the contract. For example, you might mention whether the contract is used only as a parent to group other contracts; or you can provide an overview of the type of goods covered by the agreement.

Physical Location

Enter the physical location of the contract. For example, if you are creating this con­ tract based on an existing paper contract, enter the physical location of the paper contract.

Related Contract ID

If you have a related external contract (in your ERP system or other system), enter that contract ID to create a cross reference.

Should the Related Contract ID be included as part of the systemgenerated Contract ID

Specify whether to include the related contract ID as part of the system-generated ID for the contract.

Contact

Select a contact name from the available choices, or click Search for more to select a different name.

Purchasing Unit

If purchasing unit filtering is enabled on your site, and you are responsible to create contract for multiple purchasing units, choose the purchasing unit for which you are creating the contract.

Contract Type

Select the type of contract you want to create:

Is Blanket Purchase Order

○

Item level, which covers specific items from a supplier.

○

Commodity level, which covers all products identified by specific commodity codes from a supplier.

○

Catalog level, which covers all products in a catalog

○

Supplier level, which covers all products from a supplier.

Select Yes to create a blanket purchase order. For more information about blanket purchase orders, see About Blanket Purchase Orders [page 21].

Hide Amount from Supplier(BPO

Select the check box to restrict the supplier from viewing the Amount and Quantity

only)

values for all the items in the BPO on the Ariba Network.

Hide Unit Price from Supplier(item-

Select the check box to restrict the supplier from viewing the Unit Price and

level BPO only)

Quantity values for all the items in the BPO on the Ariba Network.

Hierarchical Type

Select the hierarchical type for the contract:

Effective Date

Managing contract compliance Topics about creating and managing contracts

○

Standalone agreement, which is not part of a hierarchy.

○

Subagreement, which is a contract associated with a parent contract in a hier­ archy.

○

Master agreement, which is the top-most contract in a hierarchy.

Select the date on which users can begin to issue release orders.

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For this option...

Do this...

Expiration Date

Select the final date on which release orders can be issued against the contract. The expiration date is optional if you are creating an evergreen contract.

Evergreen

Select Yes to create an evergreen contract (a contract that does not expire). Select No to create a contract that does expire. If you select No, you need to set the Expiration Date option above.

Purch Org (SAP variants only)

Select the purchase organization for which you are creating the contract. Only users belonging to the specified purchase organization and company code have access to the contract during requisitioning or invoicing. If your site is configured to create contracts that are applicable to all company co­ des, then you can create contracts that can be accessed by all users regardless of their company code. To do this select a purchase organization that is not mapped to any company code.

Company Code (SAP variants only)

Select the company code for which you are creating the contract. Only users be­ longing to the specified purchase organization and company code have access to the contract during requisitioning or invoicing. If you are creating a contract that can be accessed by all users regardless of their company code, and have selected a purchase organization that is not mapped to any company code, then you do not need to specify a company code . Even if you specify a company code, the contract access is not restricted and can be accessed by users belonging to any company code.

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Supplier

Select a supplier from the available choices, or click Search for more to select a different supplier.

Supplier Location (Generic, People­ Soft)

Click Select to choose a different location for the supplier you named.

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For this option...

Do this...

Create subscription for non-catalog For item-level contracts, specify whether you want to generate a subscription for items (release order contracts only) non-catalog items to allows purchasing users to search the catalog for the item and to automatically apply the contract terms to the item. Subscriptions are always created for non-catalog items, fixed-fee items, cost and expense items and milestone items in a no-release order contract. If you do not generate a subscription for non-catalog contract items for release or­ der contracts, then users must create a non-catalog item with the same supplier name, part number, and (optional) auxiliary ID as the existing item on the contract when they place an order for the item. If more than one contract applies to that item, a contract is autoselected based on the contract autoselection criteria as de­ scribed in About the Autoselection Feature [page 17]. In SAP Ariba Buying and SAP Ariba Buying and Invoicing, users who belong to a group that can overwrite the au­ toselected contract can select a different contract by editing the line item on the Line Item Details page. If purchasing unit filtering is enabled on your site, the purchasing users’ purchasing unit or the parent purchasing units will be used to decide which generated subscrip­ tion items are visible to them. Note that non-catalog items are not immediately available in the catalog view un­ less you manually rebuild the catalog index to publish the subscription. By default, the index is automatically rebuild every two hours. Release Required

Select Yes to require purchase orders (release orders) to release funds governed by the contract. Select No to not require purchase orders (release orders) to release funds governed by the contract. If you select No, you must then specify whether to allow receiving and invoicing against the contract. 

Allow change orders against closed

Note ○

If your site is configured for SAP Ariba Buying without the receiving option, you can create no-release order contract requests for the purpose of ex­ porting them to your ERP or to an external contract management system.

○

If your site is configured for SAP Ariba Buying with the receiving option, you can create no-release order contract requests that allow receiving against the contract.

Select Yes to allow users to create change orders even if the contract is closed.

contract (release order contracts only) Allow receiving against contract (no-release order contracts only)

Specify whether you want to be able to create receipts against the contract. 

Note

In a merged SAP Ariba solutions environment, this option is not displayed.

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For this option...

Do this...

Allow invoicing against contract (no-release order contracts only)

Specify whether you want to be able to create invoices against the contract. 

Note

Supplier users can view the contract's available amount if either of the Allow receiving against contract or Allow invoicing against contract options are set to true. They cannot view the available amount if both these options are set to false. Default invoice requester from contract (no-release order contracts only)

Only available if the feature Invoice Compliance for Contract-based Invoices is ena­ bled for your site: If set to Yes, the Sold To email address is defaulted to the contact person on the contract. Suppliers can override this value when creating an invoice against the con­ tract.

Allow supplier to add non-catalog items to the invoice (no-release or­ der contracts only)

Only available if the feature Invoice Compliance for Contract-based Invoices is ena­ bled for your site: If set to Yes, suppliers can add additional items for which no pricing terms have been defined on the contract to the invoice. 

Note

If you allow suppliers to add non-catalog items to the invoice, they can use the advance pricing details fields to define pricing information. If the invoicing rule in your Ariba Network account does not allow suppliers to enter advanced pric­ ing details at the line item level, the invoice will fail validation only when the sup­ plier tries to submit it from their Ariba Network account. Allow supplier to edit the invoice unit price (no-release order con­ tracts only)

Only available if the feature Invoice Compliance for Contract-based Invoices is ena­ bled for your site: If set to Yes, suppliers can modify the unit price on the invoice entry from the pric­ ing terms set up the item on the contract. If the supplier overrides the unit price on the invoice, that price it the final price. No discounting or pricing terms from the contract are applied to the price provided by the supplier. 

Note

If you allow suppliers to edit the invoice unit price, they can use the advance pricing details fields to edit pricing information. If the invoicing rule in your Ariba Network account does not allow suppliers to enter advanced pricing de­ tails at the line item level, the invoice will fail validation only when the supplier tries to submit it from their Ariba Network account. Allow supplier to enter invoice accounting (no-release order con­ tracts only)

Only available if the feature Invoice Compliance for Contract-based Invoices is ena­ bled for your site: If set to Yes, the accounting fields are displayed to suppliers, and suppliers can edit the accounting information.

Apply discount terms to noncatalog items (supplier- and com­ modity-level contracts only)

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Specify whether you want to also apply the discount terms to non-catalog items.

Managing contract compliance Topics about creating and managing contracts

For this option...

Do this...

Do non-catalog items accumulate against contract? (supplier- and commodity-level contracts only)

Specify if non-catalog item purchases are included in calculation of contract limits.

Currency

Select a currency from the available choices, or click Search for more to select a different currency.

Include Subagreement Accumulators (master agreement and subagreement hierarchical types only)

Specify whether you want to allow accumulation to a parent contract.

3. When you have supplied all the necessary information, click Next to open to the Limits page.

How to define contract limits, notification recipients, and forecasting Use the Limits page to enter information such as contract limits, notification parameters, the preload amount, and forecasted spend. Limits are not supported in SAP Ariba Contract Invoicing only sites.

Context You can forecast the amount you expect to spend over the lifetime of a contract, and divide that amount by the type of fiscal period you use.  Example If you expect to spend $100,000 over a one-year contract, you can divide that amount by four quarters, forecasting $25,000 for each quarter. You can adjust each quarterly amount to account for seasonal spending or other expected fluctuations. With the previous example, you can increase the summer quarter forecast to $35,000, and decrease the winter quarter forecast to $15,000 An expected savings amount can also be established with the forecasted spend amounts to add another dimension to the data analysis.

Procedure 1. Follow the instructions to create a new contract. [page 51] . 2. Enter general contract definitions [page 52]. 3. On the Limits page, enter the following information: Managing contract compliance Topics about creating and managing contracts

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For this option...

Do this...

Minimum Commitment Minimum Commitment

Enter the minimum amount you are going to spend according to the contract. Select a currency from the available choices, or click Other to select a different cur­ rency.

If Amount Spent is Below

Enter a percentage of the minimum commitment that you want to use as the low threshold for sending notifications to your Contract Agent that the minimum com­ mitment has not yet been met.

Send Notification ___ days before contract expires

Enter the number of days prior to the contact’s expiration that you want to send noti­ fications.

Maximum Limit Maximum Limit

Enter the maximum amount you are going to spend according to the contract. Select a currency from the available choices, or click Other to select a different cur­ rency.

Excludes taxes Excludes charges

Available for no-release order contracts only: Check the Excludes taxes and Excludes charges check boxes if your maximum limit amount does not include taxes and charges and you want to accumulate the reconciled amounts net of taxes and charges. Leave the check boxes blank (default) if your maximum limit amount in­ cludes taxes and charges and you want to accumulate the reconciled available amount including taxes and charges. You cannot modify the value for Excludes taxes and Excludes charges when you change a contract. This means that if you have contracts for which you want to change the way the accumulation of the reconciled available amount is calculated af­ ter the contract is opened, you need to close the current contract and set up a new contract. 

Note

The feature to change the invoiced amount accumulation on contracts is disa­ bled and requires SAP Ariba to enable it. By default, the total invoiced and total reconciled amount accumulator, which is used to calculate the remaining amount on the contract, includes taxes and charges.

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Tolerance

Enter a percentage of the maximum limit by which release orders can exceed the contract limits.

Is Hard Maximum Limit

Specify whether you want to enforce a hard maximum limit on the amount you spend. For no-release order contracts, enforcing a hard maximum limit means that invoice exception tolerances are disregarded and invoices that exceed the contract limit are autorejected by default. Applies to SAP Ariba Buying and Invoicing and SAP Ariba Invoice Management only.

Send notification when Amount Available is at or below

Enter a percentage of the maximum limit that you want to use as a low threshold for sending notifications to your contract agent. The notification includes information about the remaining amount available for release.

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For this option...

Do this...

Item Limits Item Limits

Specify the quantity or amount for item limits.

Release Limits Minimum Allowed per Order (re­ lease order contracts only)

Enter the minimum amount required per release. Select a currency from the available choices, or click Other to select a different cur­ rency.

Is Hard Minimum Limit

Specify whether you want to enforce a hard minimum limit on the amount you spend per release order. If set to Yes, users cannot submit a requisition if the minimum amount of all items associated with the contract is less than the minimum limit de­ fined per release order. If set to No, additional approval nodes (by default the Contract Manager group) are added, but users are not prevented from submitting the requisition.

Maximum Allowed per Order (re­ lease order contracts only)

Enter the maximum amount allowed per release. Select a currency from the available choices, or click Other to select a different cur­ rency.

Is Hard Maximum Limit

Specify whether you want to enforce a hard maximum limit on the amount you spend per release order. If set to Yes, users cannot submit a requisition if the amount of all items associated with the contract is more than the maximum limit defined per re­ lease order including the release limit tolerance. If set to No, additional approval no­ des (by default the Contract Manager group) are added, but users are not prevented from submitting the requisition.

Maximum Limit Tolerance (release order contracts only)

Enter a percentage by which each release can vary from the maximum limits.

Scroll to see additional fields. For this option...

Do this...

Additional Approvers List Additional Approvers

Select a user from the available choices, or click Search for more to select different users.

Expiration Date Notification Send notification ___ days before the contract expires

Enter the number of days before the contract expires to send notifications.

Re-notify every ___ days

Enter the interval (in days) at which notifications are sent.

Notification List Send notifications to

Add additional users who will receive notifications about the contract (such as contract open notification, approaching contract limits, or unmet minimum commitments). By de­ fault, the contract requester and all users with edit access to the contract receive these notifications. Select a user from the available choices, or click Search for more to select different users.

Preload Amount

Enter the amount by which you are preloading the contract. Select a currency from the available choices, or click Other to select a different currency.

Forecasted Spend

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For this option...

Do this...

Total Amount

Enter the total amount you anticipate to spend over the life of the contract. Select a currency from the available choices, or click Other to select a different currency.

Saving %

Enter the percentage you expect to save by buying according to this contract.

Frequency

Select the calendar increments of the contract by which you want to forecast. For exam­ ple, if this contract covers a year and you select “quarter” for this option, your forecast is spread over 4 quarterly increments. The increments are displayed in the Items option. Select a frequency from the available choices, or click Search for more to select a different frequency.

Forecast

View the Start and End dates for each calendar increment you selected under the Frequency option, and view an equal division of the Total Amount over those increments. Use the calendar controls to change the date range for each increment. Use the Amount column to enter a new amount for an increment. The total for all incre­ ments must equal the total for the contract. Select the check box for an increment, then click Delete to remove the increment. Click Add to add an additional increment. Click Balance to allocate an equal portion of the contract to each increment.

4. When you have supplied all the necessary information, click Next to open the Pricing Terms page.

How to create a milestone for a contract A milestone is a set of conditions or requirements that must be met by a supplier to achieve the terms of a supplier-, commodity-, or item-level contract.

Context

 Note This feature is not applicable to sites configured for SAP Ariba Catalog only. The successful completion of a milestone typically results in partial financial payment to the supplier. A milestonebased agreement is a contract that is based on one or more milestones or deliverables. When you add a milestone item to a release order contract, the milestone is an internal milestone and is used for bookkeeping or notification purposes only. There are no limits associated with internal milestones. However, you can configure how many days before the milestone completion date to send the notification message to the contract requester and to users listed in the edit list. See Notification Limits [page 43].

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When you add a milestone to a contract without release orders, it is associated with certain limits. These milestoneitem limits can be set for item level contracts to define the limits that apply to the milestone item and include the following: ● Maximum amount, which is the maximum amount for the milestone item. This limit is used to determine the total amount that can be invoiced against the item. ● Tolerance, which is the percent above the maximum amount that can be invoiced against the item.

Procedure

1. Click Add Items. 2. Provide the following information: For this option...

Do this...

Title

Enter a title for the milestone.

Full Description

Enter a description of the terms of the milestone.

Commodity Code

Select a commodity code from the available choices, or click Search for more to select a different commodity code. Depending on your ERP integration, you may have to enter additional fields, such as Material Group (SAP) or Partitioned Commodity Code (Peo­ pleSoft).

Amount

Enter the amount to be paid upon completion of the milestone.

Tolerance

Enter a percentage by which the contract can exceed the amount specified above.

Completion Due Date

Select the date on which you expect the milestone to be completed.

Supplier Contact

Enter the name of your contact person in the supplier organization.

Verifier

Select a person who is responsible for seeing that the terms of the milestone have been met. Select a name from the available options, or click Search for more to select a different name.

Days Before Milestone Is Due

Enter the number of days before the milestone completion due date when the verifier should be notified.

3. Click OK. 4. When you have defined all the milestones for your contract, click Next to open the Access Control page.

How to control edit and release access for contracts Use the Access Control page to identify the users who can edit the contract and who can order or invoice against the contract (release access).

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When you create a contact, you are automatically given edit access (permission to edit the contract). Other users who are given edit access are: ● Members who belong to the Contract Manager or Contract Agent groups. Members of these groups can edit a submitted contract request without altering the approval flow. ● Members of the Edit Approvable group, if added to the approval flow of contracts. ● Other users that you add who are able to edit the contract. By default, all users have release access. You have the option to restrict that access to a specific set of users. If you do restrict access to a contract, neither the contract nor any items governed by the contract are visible to users who are not allowed to release funds against the contract.

Related Information Identifying users who can edit the contract [page 62] Restricting which users can release or invoice against the contract [page 62]

Identifying Users Who Can Edit the Contract Procedure 1. Under Edit Access, click [select]. 2. Click the check box for each user you want to add, then click Done. 3. To remove a user from the list, click [select] after the list of names. 4. Clear the check box for that user in the Currently Selected list, then click Done.

Restricting Which Users Can Release or Invoice Against the Contract Procedure 1. Click the check box for Restrict Release Access. Select the users who will be allowed to release or invoice against the contract by:

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Criteria

Who has release access

Name

Each individual user you select has release access.

Group

Each member of the group you select has release access.

Supervisor

Each user who reports to the supervisor you select has release access.

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Criteria

Who has release access

GL Business Unit (PeopleSoft)

Each user who belongs to the business unit you select has release access.

Project (PeopleSoft)

Each user who belongs to the project you select has release access.

Project/WBS (SAP) Ship To Address (PeopleSoft)

Each user assigned to the Ship-To Address you select has release access.

Cost Center (Generic, SAP)

Each user assigned to the cost center you select has release access.

2. Click [select] after the criterion by which you control user release access. 3. Click the check box for each user (group, supervisor, or business unit) you want to add, then click Done. 4. To remove a user from the list, click [select] for that criterion. 5. Clear the check box for that user (group, supervisor, or business unit) in the Currently Selected list, then click Done.

Results

When you have identified the users who have edit and release access, click Next to open the Payment Terms page. When you have identified the users who have edit and release access, click Next to open the Appendixes page.

How to define payment terms in contracts Use the Payment Terms page to specify when a supplier must be paid, and any early payment discounts that apply.

Procedure

1. To change the current payment terms, click Change Payment Terms. 2. Click Select for the payment term you want to use. 3. To remove all payment terms from the contract, click Remove Payment Terms.

Results

When you have configured payment terms, click Next to open the Appendixes page. Managing contract compliance Topics about creating and managing contracts

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How to add attachments to contracts Use the Appendixes page to include attachments to the contract. An appendix can be useful to amplify aspects of the contract that cannot be easily defined in the contract wizard. You can link an appendix to specific line items within the contract (for example, the pricing terms).

Procedure

1. Click Add Appendix. 2. Click Browse to locate the file to attach on your computer. 3. For Appendix Description, enter a brief description of the appendix. 4. If you are creating a blanket purchase order, check Visible to Supplier if you want the attachment sent to Ariba Network with the blanket purchase order. See About Blanket Purchase Orders [page 21] for more information. 5. If you create an item level or commodity level contract, you can link an attachment to a specific line item. Under Referenced By, click the check box for each line item in the contract that references the appendix. 6. Click OK. To delete an appendix, select its check box, then click Delete. To edit an appendix, click its Edit button. 7. Click Next to open the Summary page.

How to export contracts Exporting a contract is a good method of creating an Excel template that assures the spreadsheet is correctly formatted if you want to make changes to existing contract requests or create new contract requests through Excel import. You can export a contract to an Excel spreadsheet after you have submitted the contract request, or, if you are an approver, you can export a contract when approving the contract request. See How to upload an Excel version of a contract [page 52] for import instructions, and Spreadsheet Import Notes [page 49] for important information you need to know before importing Excel contracts. The following contract fields cannot be exported to Excel: Contract Page / Section

Field Name

Limits / Notification List

Send notifications to

Limits / Additional Approvers List

Additional Approvers

Access Control / Edit Access

Editing Users

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Contract Page / Section

Field Name

Access Control / Release Access

Restrict Release Access ●

Users by Name

●

Users by Group

●

Users by Supervisor

●

Users by Cost Center

 Note ● Exporting of contracts with two-dimensional matrix formula pricing is not supported. ● If you are importing Pricing Terms for your line items, make sure the Item Number field type in your Pricing Terms worksheet matches the Item Number field type in the Contract Item Information worksheet. For example, if you first export a contract, Item Number is exported as a field of type ‘String’. If you then change the Item Number field, Excel stores the Item Number as a numeric value. If there’s a type discrepancy on the two sheets, Excel will not import the Pricing Terms sheet. ● When exporting a contract request, depending on the client’s time zone, the Effective Date and Expiration Date in the export file might be set to a different date than is displayed in the client UI. During export, Effective Date and Expiration Date are set to the start of the day (e.g. Aug 30 00:00) and then recalculated to the server’s time zone, which is Pacific Standard Time. When the file is imported, the Effective Date and Expiration Date are recalculated from the server’s time stamp to the client’s time zone.

Related Information Exporting a Submitted Contract [page 65] Exporting a Contract During Approval [page 66]

Exporting a Submitted Contract Procedure 1. In the My Documents content item, click the ID for the contract . 2. Click Excel Export. 3. Click Open to open an Excel version of the contract in your browser. Click Save to save an Excel version of the contract in its current form.

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Exporting a Contract During Approval Procedure 1. In the To Do content item, click the Approve link for the contract request. 2. Click Excel Export. 3. Click Open to open an Excel version of the contract in your browser. Click Save to save an Excel version of the contract in its current form.

How to create a contract for autogenerating requisitions Context An auto release contract, which is a new sub-type of the release order contract, can be used for autogeneration of requisitions. A scheduled task, set to run daily, will autogenerate requisitions from these auto release contracts based on the configured schedule. For every auto release contract, separate requisitions will be generated for recurring items and non-recurring (fixed-fee) items, if the schedule is satisfied. The autogenerated requisitions will have titles with the reporting timezone corresponding to the customer site, which is configured in the site profile. If the autogenerated requisition has valid values, purchase orders will also be generated. If there are any validation errors, the requisition remains in the composing state, and an email notification is sent to the preparer of the requisition. Autogeneration of requisitions is supported only for fixed/recurring fee items, on release order contracts of the Item Level type. In addition, the only hierarchical type supported is Standalone Agreement. Blanket Purchase Orders are also not supported. SAP Ariba creates a requisition for a date in the past, it also creates one for the current date. This is done to ensure that a requisition is created in cases where the contract is created after the daily scheduled task run, where one would not have been created otherwise. The need by date for auto release contracts is set as two days after the current date (current date + 2 days). When a contract is closed and reopened again, the autogenerated requisitions will not be created for the period during which the contract remained closed. Similarly, when a contract is edited and the start date is changed to an earlier date, the autogenerated requisitions will not be created for the period between the new start date and the original start date. In both these cases, requisitions will be autogenerated from the current date onwards (the date the contract is reopened or edited).

Procedure 1. Create a new release-order contract request by selecting the Autogenerated requisitions for recurring and fixed-fee items are automatically created for dates in the past, according to the contract schedule. For example, if a contract is created in February for a calendar year, with recurring fee items, the requisition for January will be automatically created when the contract request is approved and the contract is created. When your buying solution from Contract type as Item Level.

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This displays the Auto Release radio button. 2. Choose Yes for the Autogenerated requisitions for recurring and fixed-fee items are automatically created forRelease Required radio button. 3. Choose Yes for the Auto Release radio button. This displays the Auto Release Preparer field. 4. Specify a value for the Auto Release Preparer field, and then specify values for all other necessary fields. 5. In the pricing terms screen, add recurring and non-recurring items with the respective details, along with the Release Quantity field. For example, create two non-recurring items and two recurring items with different frequencies. 6. Submit the contract request for approval.

Results When the contract request is approved the corresponding contract is generated. This contract is picked up by the scheduled task during its next run and two requisitions will be autogenerated by the system, one for the recurring items, and another for the non-recurring items.

Topics about managing contracts Considerations when closing or changing contracts [page 67] How to change, close, or reopen a contract [page 69] How to change or cancel a contract release order [page 70]

Considerations when closing or changing contracts Depending on your site configuration, you can make additional changes to contracts such as deleting or deactivating items, changing the unit of measure of non-catalog items, and changing the receiving and invoicing options.

When changing a contract (based on site configuration) You site may be configured to enable you to perform the following additional changes to contracts that have been created after a certain date: ● Delete contract line items You can only delete those line items that do not have any transactions associated with them. When you attempt to delete line items that have associated transactions, the items get deactivated and will not be available for future transactions. You cannot deactivate all the line items in a contract. Managing contract compliance Topics about creating and managing contracts

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● Edit the unit of measure of a non-catalog item You cannot edit the unit of measure of a non-catalog item if it has any associated transactions. ● Edit the Allow invoicing against contract, and Allow receiving against contract flags for no-release order contract The Allow receiving against contract flag can be changed only from No to Yes. To enable this functionality, contact your Designated Support Contact and have them log a service request. An Ariba Customer Support representative will follow up to configure your site accordingly. These changes can be performed both from the user interface as well as by importing updated contract request files.

When closing a release-order contract When a release-order contract is closed manually while there are pending submitted requisitions associated with it for which a contract was manually selected, those requisitions are automatically withdrawn from the Submitted status. Requisitions that are automatically withdrawn must be manually edited and then manually resubmitted; the attached contract is not automatically detached. This allows the user who explicitly selected this contract to reevaluate the impact and select another contract or make other adjustments to the purchase. Automatic withdrawal does not occur in the following circumstances: ● The contract’s available amount reaches zero because of release orders applied against the contract’s available amount balance. ● You change the original CR and the available amount reaches zero because the contract’s maximum commitment is set below the used amount. In this case, the contract closes automatically. ● The contract was autoselected for the requisition. In this case, the requisition remains in Submitted status, but the contract is automatically detached from the requisition, the price is recomputed to the original catalog price and the approval process is reevaluated. Similarly, if a requisition is in the Composing status, the contract is automatically detached from the requisition. If a contract is reopened, withdrawn requisitions are not automatically resubmitted.

When closing a no-release order contract When a no-release order contract that has not been fully invoiced is closed, all associated invoices in Reconciling state will be re-reconciled with the “Contract not Invoicing” exception. Invoice agents can then either accept or reject the invoice unless autorejection is configured for this invoice exception. When you close a no-release order contract which is not a blanket purchase order type contract, the supplier will no longer be able to create any invoices for the closed contract. If a supplier submits an invoice for a closed contract via EDI or cXML, the invoice is reconciled with the “Contract not Invoicing” exception. When you close a no-release order contract with is a blanket purchase order for which collaborative invoicing is allowed, the supplier can continue to create invoices on Ariba Network when punching in to SAP Ariba Invoice Management or SAP Ariba Buying and Invoicing from the Purchase Order page or by flipping an item-level blanket

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purchase order into an invoice until the contract’s maximum limit has been reached. The invoices will be reconciled with the “Contract not Invoicing” exception.

How to change, close, or reopen a contract Context From the Home page in your SAP Ariba solution, you can view all the contracts you have created and all the contracts you have permission to edit. You can view the details of those contracts, and make changes to the contract properties, as well as change and cancel the purchase orders associated with those contracts. When you change a contract, you create a new version of the contract. You can change existing contracts by importing updated contract requests in the following formats: ● Microsoft Excel workbooks ● CSV files in a ZIP file ● cXML (Blanket Purchase Orders from the Ariba Network) For more information on importing contracts, see the Common Data Import and Administration Guide for SAP Procurement solutions. See Considerations when closing or changing contracts [page 67] before you close a contract.

Procedure 1. On the dashboard, click

Manage

Contracts .

You are presented with a list of the contracts that you have created, and those that you are allowed to edit. The arrow icon next to a contract indicates that it is the parent to other contracts. You can expand and collapse a hierarchy of contracts at each parent level. 2. Click the contract ID to view details of the contract or make changes to the contract. The Summary, Pricing Terms, Milestones, and Approval Flow tabs have the same information as the corresponding pages in the contract wizard. The Orders tab lists the orders associated with the contract. The History tab lists all actions taken against the contract. The Subagreements tab lists all child contracts of the current contract. 3. To edit the contract, click Change. The contract opens on the Summary page of the contract wizard. Certain fields cannot be changed after the contract request has been approved and the contract has been created. Edit the fields you want to modify, and then resubmit the contract. ○ Depending on your site configuration, you may be able to make additional changes to contracts [page 67] such as deleting or deactivating items, changing the unit of measure of non-catalog items, and changing the receiving and invoicing options. ○ If you modify the contract’s expiration to an evergreen contract, the original contract’s expiration date is retained, and users may still get notifications based on that original expiration date. Ensure you remove the expiration date to avoid unnecessary notifications. Managing contract compliance Topics about creating and managing contracts

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○ If you change a manually closed contract, the new contract is automatically closed, but you can then reopen it. ○ All contract accumulators are carried over from the original to the new version of the contract. ○ When a new version of a contract is approved, the catalog subscriptions are validated. Catalog subscriptions are only created for items that have any available amount/quantity left. This also applies to recurring fee items - regardless of the billing and end date for the recurring fee item, if the number of recurrences has reached the maximum number of recurrences, the item is not added to the catalog subscriptions. In that case, if you want to create a new subscription for the recurring fee item, you must add a new item to the contract. 4. To manually close the contract, click Close Contract. ○ You can reopen manually closed contracts, but you cannot reopen automatically closed contracts (contracts that have reached their maximum spend limit). 5. To reopen a manually closed contract, click Open or Unclose. The Unclose button is displayed for closed contracts with an effective date greater than today’s date. If a contract is reopened, its state will be set as follows: ○ Set to Processed if the effective date is greater than today’s date. ○ Set to Open if the effective date has been reached and the contract’s maximum spend limit has not been reached. ○ Set to Received if the contract has been fully received, but not fully invoiced. ○ Set to Invoiced if the contract has been fully invoiced, but not fully received. ○ Set to Inactive if the contract expiration date is in the past.

How to change or cancel a contract release order Context If you need to change or close a contract early, you might have to cancel or change associated release orders. You can find assoicated orders from the Contracts pages.

Procedure

1. On the dashboard, click

Manage

Contracts .

2. Click the contract ID for which you want to change or cancel a release order. 3. Click the Orders tab. 4. In the Orders section, click the Order ID link to display the details of the release order. In the Line Items section, click the ReqID link. 5. You are now viewing the Requisition Review page. Click the Orders tab. 6. Click the check box for the release order, then: ○ Click Change Order to make changes to the order.

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○ Click Cancel Order to cancel the order. For more information about changing and canceling orders, see the Purchasing user guide for procurement professionals.

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Topics about pricing terms in contracts

Pricing terms specify the specific pricing information, such as discount for volume orders, that are applied to your orders or invoices. Discount pricing in contracts [page 72] Tiered pricing in contracts [page 73] Tiered pricing types [page 74] Term-based pricing in contracts [page 76] Term-based grid pricing in contracts [page 78] Formula pricing in contracts [page 79] Repricing for tiered and term-based pricing [page 82] How to define pricing terms on contracts [page 83]

Discount pricing in contracts You can specify discount pricing for a supplier, commodity, catalog, or non-catalog item. Discount pricing can either be of type Discounted Price (fixed price) or Discount Percent (fixed percentage off pricing). With discounted price or discount percent, you can specify a flat discounted price or a fixed percentage off the regular price. A discounted price can be applied to catalog items only. A fixed percentage off can be applied to catalog items, commodities, or all items offered by a supplier.  Note You can enter negative discount percentages to allow for markup pricing for suppliers who want the ability to provide a base price on their catalog items. Then the negotiated contract will include a markup percentage on that base price.

Catalog Imports and Repricing for Discount Pricing If a catalog import modifies the price of a catalog item that is referenced on an item level contract, the new price is not displayed in the contract. Similarly, if a catalog import modifies the description of a catalog item, the modified description is not displayed in the contract. This situation occurs because item level contracts retain a copy of the catalog item price and description for display purposes at the time the contract was created. If the item level pricing term specifies a discount percentage off the regular price for a catalog item, the new (reimported) price is used to calculate the discounted price for the item.

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If the item level pricing term does not specify a discount percentage off the regular price (for example, if the item is governed by a fixed discounted price), then the pricing for the item is determined by the original price for the item (that is, the price of the item at the time the contract was created). This situation does not occur for supplier level, catalog level and commodity level contracts because prices are not specified for individual line items on these types of contracts.

Tiered pricing in contracts Tiered pricing allows you to specify different discounts based on the volume (either dollar or quantity) purchased or invoiced against the contract. ● Tiered pricing is not supported in supplier level and commodity level contracts for services procurement items. ● Cumulative tiered pricing is not available in sites configured for SAP Ariba Catalog or SAP Ariba Contract Invoicing only.  Note ● You can enter negative discount percentages to allow for markup pricing for suppliers who want the ability to provide a base price on their catalog items. Then the negotiated contract will include a markup percentage on that base price for the pricing tiers, pricing terms or pricing formulas you define.

Applying Pricing Tiers The applicable tiers are determined based on the total amount using the actual base price of the item. When setting up pricing tiers for volume discounting, you can define if the pricing tiers are cumulative (based on all orders or invoices), or if they are applied per order.

Per Order Pricing When using per order pricing, the unit price that will be applied will be from the tier which provides the best value, and that price is applied to all items on the order. For example, assuming the following pricing tiers and a base price of $5.00 USD, any order with a quantity between 20 and 40 will result in applying a unit price of $4.00 USD, and any order with a quantity of 41 or higher will result in applying a unit price of $3.00 USD to calculate the order amount. Minimum Dollar Amount of Purchase

Price per Item

$0.00USD

$5.00USD

$100.00USD

$4.00USD

$200.00USD

$3.00USD

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Cumulative Pricing When using cumulative pricing, if the total quantity for one or multiple orders spans two tiers then the unit price is calculated as: Unit Price = [(number of items accommodated in previous tier x price defined in previous tier ) + (number of items in current tier x price in current tier)] / total number of items Example using the pricing tiers above: Release Order 1 (R1) is for a quantity of 17. Applying the base price of $5.00 USD, the total calculated amount is $85.00 USD, and the tier 1 unit price of $5.00 USD is applied. Release Order 2 (R2) is for a quantity of 15. R1 total amount ($85.00 USD) + 15 x $5.00 USD (R2 calculated at base price) = $160.00 USD. The cumulative order amount has passed the threshold to tier 2, so the unit price to apply to the second order is calculated as follows: 3 (remaining number of items in tier 1 before passing the threshold to tier 2) x $5.00 USD + 12 (number of items applied to tier 2 pricing) x $4.00 USD / 15 = $4.20 USD If R2 is for a quantity of 30, the unit price for the order is calculated as follows: 3 (remaining number of items in tier 1 before passing the threshold to tier 2) x $5.00 USD + 25 (items available in tier 2 before passing the threshold to tier 3) x $4.00 USD + 2 (remaining number of items applied to tier 3 pricing) x $3.00 USD / 30 = $4.03 USD

Tiered pricing types Your SAP Ariba solution provides the following types of tiered-pricing structures for contracts: ● Amount-based Volume Pricing [page 74] ● Amount-based Volume Discount [page 75] ● Quantity-based Volume Pricing [page 75] ● Quantity-based Volume Discount [page 75]  Note Depending on the type of contract (item, catalog, commodity or supplier level), the pricing can be cumulative or apply to individual orders or invoices. In SAP Ariba Catalog only sites, tiered pricing applies to individual shopping carts only.

Amount-based Volume Pricing Available on item level contracts only. Sets different prices based on the dollar amount purchased. This pricing structure can be cumulative (based on all orders or invoices) or apply only to individual orders or invoices.

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For example: Minimum Dollar Amount of Purchase

Price per Item

$0.00USD

$5.00USD

$100.00USD

$4.00USD

$200.00USD

$3.00USD

Amount-based Volume Discount

Available for all contract types. Applies different discount percentages based on the dollar amount purchased. On item level and catalog level contracts, this pricing structure can be cumulative (based on all orders or invoices) or apply only to individual orders or invoices. For commodity and supplier level contracts, this pricing structure is always cumulative. For example: Minimum Dollar Amount of Purchase

Discount Percent

$0.00USD

5%

$100.00USD

6%

$200.00USD

7%

Quantity-based Volume Pricing

Available on item level contracts only. Sets different prices for an item based on the number of units purchased. Can be cumulative (based on all orders or invoices), or apply only to individual orders. For example: Minimum Quantity Purchased

Price per Item

0 units

$5.00USD

100 units

$4.00USD

200 units

$3.00USD

Quantity-based Volume Discount

Available on item level contracts only. Applies different discount percentages for an item based on the number of units purchased. Can be cumulative (based on all orders or invoices), or apply only to individual orders. Managing contract compliance Topics about pricing terms in contracts

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For example: Minimum Quantity Purchased

Discount Percent

0 units

5%

100 units

6%

200 units

7%

Term-based pricing in contracts Term-based pricing allows you to specify different discounts based on specified time periods within the life of the contract. Your Ariba solution provides the following types of term-based pricing structures for contracts: ● Term-based Discount (a percentage discount) ● Term-based Pricing (a fixed price discount)  Note ● You can enter negative discount percentages to allow for markup pricing for suppliers who want the ability to provide a base price on their catalog items. Then the negotiated contract will include a markup percentage on that base price for the pricing tiers, pricing terms or pricing formulas you define. ● In site enabled for SAP Ariba Catalog only, term-based pricing and term-based grid pricing are not available.

Limitations to Term-Based Pricing ● Term-based pricing is not supported in supplier level and commodity level contracts for services procurement items. ● Term-based pricing is not available in sites configured for SAP Ariba Catalog only.

Term-based Discount With term-based discount pricing, you specify different discount percentages for an item based on specified time periods. For example: Start Date

Price

07/01/2012

5%

10/01/2012

10%

01/01/2013

12%

04/01/2013

8%

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Term-based discount pricing is valid for catalog and non-catalog items (if the contract allows), commodities, and suppliers.

Term-based Pricing With term-based pricing, you specify different prices for an item based on specified dates. For example: Start Date

Price

07/01/2012

500USD

10/01/2012

100USD

01/01/2013

120USD

04/01/2013

800USD

Term-based pricing is valid only for catalog and non-catalog items (without a previously defined discount price).

Defining Term Boundaries The term-based pricing time periods must be bounded by the life of the contract. For example, the first pricing date (Start Date) must be equal to or after the contract’s effective date, and the final pricing date must be equal to or before the contract’s end date. For release order contracts, the requisition’s Delay Purchase Until date determines the pricing date. If there is no Delay Purchase Until date, the requisition’s Submitted date is used. For no-release order contracts, the invoice date or the receipt date is used as the pricing date. For evergreen contracts, if the release order date is outside of the boundary dates specified in the contract’s termbased pricing, the price specified in the last time period is used. Take for example a contract with the following pricing terms: Start Date

Discount

07/01/2005

5%

10/01/2005

10%

01/01/2006

12%

04/01/06

8%

If the release order date is 09/05/06, the contract pricing uses the discount price in the last term: 04/01/06 with an 8% discount.

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Term-based grid pricing in contracts Term-based grid pricing allows you to specify the price for an item over time, based on attributes of that item, and values for those attributes. Term-based grid pricing also includes terms, or date ranges, during which prices are in effect for an item. For more information on terms, see Term-based Pricing [page 77].  Note Term-based grid pricing is not available in sites configured for SAP Ariba Catalog only. For example, an item may be Airport Terminal Rent. The attribute of that item would be location, for example, San Francisco Airport. Location could have values like Aisle, Rest Room, and Ticket Counter. The attribute values are further refined by Price, Max. Quantity, and Max. Amount. The following example shows term-based grid pricing for terminal rents at XYZ airport: Location Ticket Counter 1

Ticket Counter 2

Tuesday, January 1, 2017 (term start date) ●

Price = $25.00

Thursday, January1, 2018 (term start date) ●

Price = $25.50

●

Max. Quantity = 100

●

Max. Quantity = 100

●

Max. Amount = $2500.00

●

Max. Amount = $2550.00

●

Price = $25.00

●

Price = $25.50

●

Max. Quantity = 100

●

Max. Quantity = 100

●

Max. Amount = $2500.00

●

Max. Amount = $2550.00

In this example: Beginning on January 1, 2017, each ticket counter will be rented at a rate of $25.00 per square foot per year; the maximum number of square feet covered by the contract for that ticket counter is 100; the maximum amount that can be charged for rent during that time period is $2,500.00. Beginning on January 1, 2018, each ticket counter will be rented at a rate of $25.50 per square foot; the maximum number of square feet covered by the contract for that ticket counter is 100; the maximum amount that can be charged for rent during that time period is $2,550.00. The values for Price, Max. Quantity, and Max. Amount are defined in each cell of the grid. Term-based grid pricing is valid only for no-release, item level contracts, and for partial items whose attributes have string values.  Note ● When you export a contract to Excel, the pricing grid is exported as part of the contract. Likewise, when you import an Excel contract in which a pricing grid is defined, the grid is imported. ● In order to take advantage of term-based grid pricing, you need to have the necessary partial items and attributes defined in your catalog. ● If you reach the cell limit for an item (for example, Max. Quantity), an exception is raised. You handle the exception as you like (for example, you can accept it or dispute it). ● If you reach the limit for a line item (for example, the total amount that can be spent on a line item), then that line item is no longer available.

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● If you reach the limit for the contract, the contract is closed. ● The state of a contract (Open or Closed) cannot be tied to cell limits. For example, you cannot have a contract close automatically when a cell limit is reached. ● Accounting at the cell level is not supported. Accounting at the line-item level is supported. ● If your catalog changes after you create a contract with term-based grid pricing and an attribute of one of the items for which you have defined grid pricing is no longer available in the catalog, you cannot create a new version of that contract based on the current catalog. If you need to create a new version of that contract, you have to reload your catalog data, and include the item attributes that were left out of the new catalog. With the correct catalog data in place, you can then create a new version of the contract.

Formula pricing in contracts Formula pricing allows you to specify a price based on a mathematical formula. Your SAP Ariba solution supports different types of formula pricing, including Matrix and Multiplier pricing. Formula pricing is available when a partial item is added to your contract request. The following example shows formula pricing for a printing job where the price is calculated as follows: For an 8-1/2 inch x 11 inch sheet of paper: The initial setup cost (including two colors)

$600.00

Additional colors

$300.00 each

Price/1000 sheets of paper

$50.00

Additional colors/1000 sheets of paper

$40.00

In this example, the calculation of the pricing for the item can be represented by the following formula: 600 + Max(0,NumColors - 2) * 300.00 + 50.00 * (NumSheets/1000) + Max(0,NumColors 2) * 40.00 * (NumSheets/1000) The preceding example shows a formula employing one-dimensional matrixes, where each variable (such as NumSheets) changes independently of any other variables in the formula. Your SAP Ariba solution also supports a two-dimensional matrix in formula pricing, in which one variable can change value in response to a second variable’s value. For example, consider a pricing formula for T-shirts in which the formula uses a base price of $20 plus a twodimensional matrix (size_color_matrix) that accounts for additional price markup required by the combination of size and color of the shirt. The formula would be: 20 + size_color_matrix The variable size_color_matrix is a two-dimensional matrix that can be represented by a table: Green

Blue

White

Small

0

1

0

Medium

2

1

1

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Large

2

3

2

Formula pricing is valid for partial items from the catalog with contractible factors. Only enumerated types on a partial item can be used when defining the direct attributes used in formula pricing. Some contractible factors (decimal or money values) can be added to the formula directly, whereas other factors (such as boolean, string, or other field values for the category-based item) are considered enumerated values for the factor and must be mapped to numerical values before being added to the formula. Contact Customer Support for more information on creating custom formula functions.

Multiplier Pricing Multiplier pricing allows you to specify a price based on type information, where the item contains a base price and each type contains a multiplier to be used against the base price. The following example shows multiplier pricing for a pipe item that considers material, weld type, and the shift of the person making the pipe: Material

Weld Type

Shift

Copper

1.10

Intersect

1.20

58

1.00

Stainless Steel

1.20

Butt

1.30

5 10

1.10

Carbon Steel

1.30

Joint

1.40

6 10

1.20

Assuming the pipe has a base price of $5.00, if you select a stainless steel pipe with an intersect weld type from shift 5 8, the price would be as follows: $5.00 * 1.20 * 1.20 * 1.00 = $7.20 Notice that the different types are not related in any way. For example, the multiplier for the intersect weld type is always 1.20, regardless of which material or shift you select. Multiplier pricing is valid for partial items from the catalog with contractible factors. Only enumerated types on a partial item can be used when defining the direct attributes used in multiplier pricing. Some contractible factors (decimal or money values) can be added to the multiplier directly, whereas other factors (such as Boolean, string, or other field values for the category-based item) are considered enumerated values for the factor and must be mapped to numerical values before being added to the multiplier.

Matrix Pricing Matrix pricing allows you to specify a price based on different related factors. The following example shows matrix pricing for temporary labor where one factor is the location and other factor is the job class: Job Class

Accountant

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Location San Francisco

Los Angeles

New York

$40.00/hour

$35.00/hour

$50.00/hour

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Job Class

Location

Admin Assistant

$35.00/hour

$30.00/hour

$45.00/hour

HR Representative

$30.00/hour

$25.00/hour

$40.00/hour

In this example, if an administrative assistant were hired in New York, the amount would be $45.00 per hour. Matrix pricing is valid only for partial items from the catalog. Only enumerated types on a partial item can be used when defining the n-dimensional grid used in matrix pricing.

Specifying Currency Values in Formula Pricing The values used in evaluating a formula are based on the amount in the site's default currency to ensure that the result of the formula evaluation is always interpreted consistently in one currency independent of a user's preferred currency. The resulting value is then converted to the currency defined for the contract during ordering or invoicing.

Example Assuming the site default currency is USD, the contract currency is EUR, and the formula pricing for a Rate field based on Location has a grid value of 11 for a Domestic Carrier item. The conversion rates are as follows: ● USD:EUR = 0.8851 ● GBP:USD = 1.3, ● EUR:GBP = 0.6827 Requisitions created by users in different countries for a Domestic Carrier item will have the following values: ● A requisition created by a user in Germany with preferred currency EUR: line amount is 9.74 EUR for Domestic Carrier; the requisition total cost is 9.74 EUR. ● A requisition created by a user in Great Britain with preferred currency GBP: line amount is 9.74 EUR for Domestic Carrier; the requisition total cost is 6.65 GBP. ● A requisition created by a user in the United States with preferred currency USD: line amount is 9.74 EUR for Domestic Carrier; the requisition total cost is 11.00 USD. This behavior can be overridden by applying a currency function. This allows contract agents to explicitly assign a currency to the value used in the formula expression. Using the previous example, where the grid values for Domestic Carrier or International Allowed are evaluated in USD (the site's default currency), if the formula is set up to associate the formula values as values in EUR, the results are: ● For the user in Germany: line amount is 11.00 EUR for Domestic Carrier; the requisition total cost is 11.00 EUR. ● For the user in Great Britain: line amount is 11.00 EUR for Domestic Carrier, the requisition total cost is 7.50 GBP. ● For the user in the United States: line amount is 11.00 EUR for Domestic Carrier; the requisition total cost is 12.45 USD. Managing contract compliance Topics about pricing terms in contracts

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In this example, the calculation of the pricing for the item can be represented by the following formula: curr(Location,”EUR”)

Repricing for tiered and term-based pricing To ensure that the most current price is applied, your solution reapplies prices to, or reprices, line items in requisitions or shopping carts that are governed by tiered or term-based pricing.  Note Do not confuse repricing with autoselection; your solution does not reevaluate autoselection when repricing a line item. For information on autoselection, see About the Autoselection Feature [page 17].

Repricing of cumulative tiered-priced items Because cumulative tiered pricing is based on a changing running total, the price applied to a line item can change during the lifecycle of a requisition. For example, the price of an item can change between the time the item is added to a requisition and the time the requisition is submitted for approval. By default, repricing for cumulative tiered pricing happens when the release order reaches the Ordered state. However, your site can be configured to trigger repricing of line items when the requisition is submitted for approval, or fully approved. Once a requisition is in the Ordered status, repricing is no longer performed.

Repricing of per-order tiered or term-priced items A line item that is governed by per-order tiered or term-based pricing is repriced when users change the quantity of the line item on the requisition or in the shopping cart. Repricing can also occur if a contract agent changes the pricing terms for the item on the associated contract. If you have enabled the Demand Aggregation feature on your site, the unit price of the line items on your requisition might increase when you submit the requisition. This typically happens when some line items in a requisition are held for aggregation. The contract associated with the held line items is detached, leading to an increase in the unit price of the held line items. Also, as repricing for other items on the requisition now happens based on a lower order amount, the unit price of other items might also increase.

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Support for CLID fields Certain contract line items document (CLID) fields from SAP Ariba Contracts can be consumed by SAP Ariba Procurement solutions and displayed in the catalog search results, purchase requisitions, and all related documents. In sites where SAP Ariba Procurement solutions are integrated with SAP Ariba Contracts, the contract creation process starts in the contract workspace in the SAP Ariba Contracts solution. A contract terms link document is created in the contract workspace which creates an associated compliance contract request in the SAP Ariba procurement or invoicing solution. You then specify pricing terms in the contract compliance request. If the contract line items documents (CLIDs) feature in your SAP Ariba Contracts solution is enabled, and if your workspace has contract line item documents, then the contents are automatically copied to the compliance contract when you create a contract terms link document. A contract line items document (CLID), or line items document, specifies terms of the contract, or the goods or services acquired by the contract. Each line item includes pricing information and terms, such as price and quantity. The following CLID fields can be consumed by SAP Ariba Procurement solutions and displayed in the catalog search results, purchase requisitions, and all related documents: ● Manufacturer Part Number ● Supplier Part Number ● Material Number ● URL  Note You must contact SAP Ariba Customer Support to create the required extensible catalog field and to configure your site accordingly to consume the Material Number CLID field data. To enable this feature, have your Designated Support Contact (DSC) submit a Service Request (SR). An SAP Ariba Customer Support representative will follow up to complete the request.

How to define pricing terms on contracts Use the Pricing Terms page to define the pricing terms between your company and the supplier you specified on the Definitions page. The options on this page vary depending upon the type of contract you are creating. How to configure pricing terms for a supplier-level contract [page 84] How to configure pricing terms for a commodity-level contract request [page 86] How to configure pricing terms for item-level contracts [page 88] How to define pricing tiers on contracts [page 97] How to define term-based pricing [page 98] How to define term-based grid pricing [page 99] How to define formula pricing in contracts [page 103] Managing contract compliance Topics about pricing terms in contracts

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How to configure pricing terms for a supplier-level contract Context

If you are creating a supplier-level contract, the Pricing Terms page lists the name of the supplier and the type of discount.

Procedure

1. Start the contract wizard [page 51]. 2. Enter general contract definitions [page 52]. 3. Enter contract limits, notification parameters, the preload amount, and forecasted spend [page 57]. 4. Click the link in the Supplier column to see details about the supplier. 5. Click Edit to define the pricing terms. Provide the following information: For this option...

Do this...

Description Full Description

Enter a description of the pricing terms.

Additional Data

View a read-only field that might or might not contain data.

Pricing and Discounts None

Select this option if there is no pricing discount according to this contract.

Discount Percent

Select this option if there is a percent discount according to this contract, and enter the percent discount (for example, 10%).

Tiered Pricing

Select this option if you are specifying tiered pricing for this contract. For more infor­ mation, see Tiered Pricing [page 73]. Click Define Tiers to open the Tiered Pricing page. For information about working with the Tiered Pricing page, see Defining Pricing Tiers [page 97].

Term Based Pricing (not available in SAP Ariba Catalog only sites)

Select this option if you are specifying term-based pricing for this contract. For more information, see About Term-based Pricing [page 76]. Click Define Terms to open the Term Based Pricing page. For information about working with the Term Based Pricing page, see Defining Term-based Pricing for Con­ tracts [page 98].

Allow Supplier to Edit Service Sheet Unit Price

Available only if the feature to allow suppliers to edit the unit price of items on service sheets after punchin from Ariba Network is enabled for your site: If set to yes, suppliers while creating service sheets can edit the unit price of items added during punchin.

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Compound with applicable Specify whether you want to compound the child contract’s pricing terms with the parent’s pricing terms (child agree­ parent’s. ments only) Add Accumulators to Parent Specify whether you want to allow accumulation from a child contract. Agreement (child agreements only) Accounting

Accounting fields vary depending on your system’s integration and configuration. Click Fill Values to default the accounting values or manually specify valid values. For more information on how the accounting values are defaulted, see Accounting infor­ mation on contracts [page 34]. To reset the accounting fields to blank values, click Clear Values and Splits.

Item Category

Select a category from the menu.

Account Assignment

Select an account assignment from the menu.

Overall Limit (services only)

Enter the maximum amount allowed for all services covered by this contract. Select a currency from the available choices, or click Other to select a different cur­ rency.

Expected Value (services only)

Enter the maximum amount expected for all services covered by this contract. Select a currency from the available choices, or click Other to select a different cur­ rency.

Bill To

Select a value from the available choices, or click Search for more, to select a different value. 

Note

(For sites integrated with SAP ERP) If enabled for your site, specifying the Bill To value might not be mandatory if you do not specify a company code on contract requests associated with a global purchasing unit. Different combinations of the fol­ lowing options are displayed de­ pending upon the value you set for the Account Assignment option above.

Select a value from the available choices, or click Search for more, to select a different value.

Asset Number Cost Center GL Account Internal Order Project/WBS

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For this option...

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Split Accounting

Click Split Accounting to spread the cost across multiple accounting groups. Supply the necessary information for each group 

Note

If you have added split lines before filling the accounting values, and then click Fill Values, all split lines will be deleted permanently. SAP Ariba recommends that you click Fill Values (or specify them manually) be­ fore adding split lines.

6. Click OK. 7. Click Next to open the Milestones or Access Control page depending on the features enabled for your site.

How to configure pricing terms for a commodity-level contract request Context

If you are creating a commodity-level contract, the Pricing Terms page lets you add commodity codes.

Procedure

1. Start the contract wizard [page 51]. 2. Enter general contract definitions [page 52]. 3. Enter contract limits, notification parameters, the preload amount, and forecasted spend [page 57]. 4. Click Add Items. 5. Provide the following information: For this option...

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Description Full Description

Enter a description of the commodity.

Commodity Code

Select a value from the available choices, or click Search for more, to select a different value. Depending on your ERP integration, you may have to enter additional fields, such as Material Group (SAP) or Partitioned Commodity Code (PeopleSoft).

Limits

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Minimum Amount

Enter the minimum amount you are going to spend according to the contract. Select a currency from the available choices, or click Other to select a different cur­ rency.

Maximum Amount

Enter the maximum amount you are going to spend according to the contract. Select a currency from the available choices, or click Other to select a different cur­ rency.

Tolerance

Enter a percentage of the maximum limit by which release orders can exceed the contract limits.

Receiving Required (no-release or­ der contracts only)

Specify whether receipts are required for items purchased according to this contract.

Release Limits (release order con­ tracts only) Minimum Amount / Quantity per Order

Enter the minimum amount or quantity required per line item on a release order. Select a currency from the available choices, or click Other to select a different cur­ rency.

Is Hard Minimum Limit

Specify whether you want to enforce a hard minimum limit on the amount/ quantity per line item. If set to Yes, users cannot submit a requisition if the minimum amount/ quantity of the line item is less than the minimum line item limit defined on the con­ tract. If set to No, additional approval nodes (by default the Contract Manager group) are added as approvers, but users are not prevented from submitting the requisition.

Maximum Amount / Quantity per Order

Enter the maximum amount or quantity allowed per line item on a release order. Select a currency from the available choices, or click Other to select a different cur­ rency.

Maximum Limit Tolerance

Specify the tolerance percentage for the maximum limit.

Is Hard Maximum Limit

Specify whether you want to enforce a hard maximum limit on the amount/ quantity per line item. If set to Yes, users cannot submit a requisition if the amount/quantity of the line item on the requisition exceeds the maximum line item limit (including tol­ erances) defined on the contract. If set to No, additional approval nodes (by default the Contract Manager group), but users are not prevented from submitting the requi­ sition.

Pricing and Discounts None

Select this option if there is no pricing discount according to this contract.

Discount Percent

Select this option if there is a percent discount according to this contract. Enter the percent discount (for example, 10%).

Tiered Pricing

Select this option if you are specifying tiered pricing for this contract. For more infor­ mation, see Tiered Pricing [page 73]. Click Define Tiers to open the Tiered Pricing page. For more information, see Defining Pricing Tiers [page 97].

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For this option...

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Term Based Pricing (not available in SAP Ariba Catalog only sites)

Select this option if you are specifying term-based pricing for this contract. For more information, see About Term-based Pricing [page 76]. Click Define Terms to open the Term Based Pricing page. For more information, see Defining Term-based Pricing for Contracts [page 98].

Allow Supplier to Edit Service Sheet Unit Price

Available only if the feature to allow suppliers to edit the unit price of items on service sheets after punchin from Ariba Network is enabled for your site: If set to yes, suppliers while creating service sheets can edit the unit price of items added during punchin.

6. Click OK to return to the Pricing Terms page. 7. Click Edit for an item to edit the accounting information. 8. Click Next to open the Milestones page.

How to configure pricing terms for item-level contracts If you are creating an item-level contract, the Pricing Terms page lets you add information about the following: ● Materials and services ● Fixed and recurring fees (no-release order contracts only) ● Costs and expenses (no-release order contracts only) ● Advanced pricing details for materials  Note If you are defining pricing terms for an item controlled by a category definition, you may see additional fields on the pricing term pages that allow you to overwrite the values set by the category definition. These new policy values are then used to validate the values you enter when ordering the item.

Related Information How to configure pricing for goods and services from a catalog [page 89] How to configure pricing for goods and services for a non-catalog item [page 92] How to configure pricing for fixed and recurring fees [page 95] How to configure pricing for costs and expenses [page 96]

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How to configure pricing for materials and services items from a catalog Procedure 1. Start the contract wizard [page 51]. 2. Enter general contract definitions [page 52]. 3. Enter contract limits, notification parameters, the preload amount, and forecasted spend [page 57]. 4. Click Next. 5. On the Pricing Terms page, under Materials and Services, click Add Items. 6. Search or browse your catalog to find the item for which you want to set pricing terms. 7. Click Add Item to add the item to the contract. The Add/Edit Item Level Pricing Terms page opens. Enter pricing terms for the item as follows: For this option...

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Description ERS Allowed

This field is visible only to members of the Contract Manager group. Select Yes to enable automatic creation of invoices for fully approved receipts.

Limits Set Item Limits By

Select Quantity or Amount to determine the method by which the next two options are set.

Minimum Quantity/Amount

For minimum quantity, enter the minimum number of items that must be purchased according to the contract. For minimum amount, enter the minimum amount you are going to spend according to the contract. Select a currency from the available choices, or click Other to select a different cur­ rency.

Maximum Quantity/Amount

For maximum quantity, enter the maximum number of items that can be purchased according to the contract. For maximum amount, enter the maximum amount that can be purchased according to the contract. Select a currency from the available choices, or click Other to select a different cur­ rency.

Tolerance

Enter a percentage of the maximum quantity or amount by which you can exceed the contract.

Receiving Required (no-release or­ der contracts only)

Specify whether receipts are required for items purchased according to this contract.

Release Limits (release order con­ tracts only)

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For this option...

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Minimum Amount / Quantity per Order

Enter the minimum amount or quantity required per line item on a release order. Select a currency from the available choices, or click Other to select a different cur­ rency.

Is Hard Minimum Limit

Specify whether you want to enforce a hard minimum limit on the amount/ quantity per line item. If set to Yes, users cannot submit a requisition if the minimum amount/ quantity of the line item is less than the minimum line item limit defined on the con­ tract. If set to No, additional approval nodes (by default the Contract Manager group) are added as approvers, but users are not prevented from submitting the requisition.

Maximum Amount / Quantity per Order

Enter the maximum amount or quantity allowed per line item on a release order. Select a currency from the available choices, or click Other to select a different cur­ rency.

Maximum Limit Tolerance

Specify the tolerance percentage for the maximum limit.

Is Hard Maximum Limit

Specify whether you want to enforce a hard maximum limit on the amount/quantity per line item. If set to Yes, users cannot submit a requisition if the amount/quantity of the line item on the requisition exceeds the maximum line item limit (including tol­ erances) defined on the contract. If set to No, additional approval nodes (by default the Contract Manager group) are added, but users are not prevented from submit­ ting the requisition.

Pricing and Discounts None

Select this option if there is no pricing discount according to this contract.

Discounted Price

Select this option if there is a discount price according to this contract. Enter the percent price. Select a currency from the available choices, or click Other to select a different cur­ rency.

Discount Percent

Select this option if there is a percent discount according to this contract. Enter the percent discount (for example, 10%).

Tiered Pricing

Select this option if you are specifying tiered pricing [page 73] for this contract. Click Define Tiers to open the Tiered Pricing page. For more information, see How to define pricing tiers on contracts [page 97].

Term Based Pricing (not available in SAP Ariba Catalog only sites)

Select this option if you are specifying term-based pricing [page 76] for this contract. Click Define Terms to open the Term Based Pricing page. For more information, see How to define term-based pricing [page 98].

Allow Supplier to Edit Service Sheet Unit Price

Available only if the feature to allow suppliers to edit the unit price of items on service sheets after punchin from Ariba Network is enabled for your site: If set to yes, suppliers while creating service sheets can edit the unit price of items added during punchin.

Term Based Grid Pricing (not avail­ Select this option if you are specifying term-based grid pricing [page 78]. able in SAP Ariba Catalog only sites) Click Define Terms to open the Term Based Grid Pricing page. For more information, see How to define term-based grid pricing [page 99].

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Formula Pricing

Select this option if you are specifying formula pricing [page 79] . Click Define Formula to open the Formula Pricing page. For more information, see How to define formula pricing in contracts [page 103].

Accounting

Accounting fields vary depending on your system’s integration and configuration. Click Fill Values to default accounting values or manually specify valid values. For more information on how the accounting values are defaulted, see Accounting infor­ mation on contracts [page 34]. To reset the accounting fields to blank values, click Clear Values and Splits.

Account Assignment

Select an account assignment from the menu.

Account Type

Select an account type from the menu.

Bill To

Select a value from the available choices, or click Search for more, to select a different value. 

Note

(For sites integrated with SAP ERP) If enabled for your site, specifying the Bill To value might not be mandatory if you do not specify a company code on contract requests associated with a global purchasing unit. Different combinations of the fol­ lowing options are displayed de­ pending upon the value you set for the Account Assignment option above.

Select a value from the available choices, or click Search for more, to select a different value.

Asset Number Cost Center GL Account Internal Order Project/WBS Split Accounting

Click Split Accounting to spread the cost across multiple accounting groups. Supply the necessary information for each group.

Additional Pricing Details

Click the Additional Pricing Details link and enter values for the advanced pricing details. 

Note

The advanced pricing details fields are not applicable for service line items. Price Unit Quantity

Enter the quantity corresponding to the unit price of the item specified by the sup­ plier. The unit price is based on the price unit quantity of the item.

Price Unit

Enter the unit of measure for the unit price.

Unit Conversion

Enter the ratio used to convert the ordered unit to the price unit. The unit price is based on the price unit quantity and the price unit.

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Pricing Description

Enter a pricing description. You can enter any information for the advanced pricing details.

8. Click OK to return to the Pricing Terms page.

How to configure pricing for materials and services for a noncatalog item Context You can configure a release order contract to create subscriptions for non-catalog items [page 52]. This allows purchasing users to search the catalog for the item, and it automatically applies the contract terms to the item. Subscriptions are always created for non-catalog items in no-release order contracts. If you do not generate a subscription for non-catalog contract items, then users must create a non-catalog item with the same supplier name, part number, and (optional) auxiliary ID as the existing item on the contract when they place an order for the item. If more than one contract applies to that item, a contract is autoselected based on the contract autoselection criteria as described in About the Autoselection Feature [page 17]. In SAP Ariba Buying and SAP Ariba Buying and Invoicing, users who belong to a group that can overwrite the autoselected contract can select a different contract by editing the line item on the Line Item Details page. If purchasing unit filtering is enabled on your site, the purchasing users’ purchasing unit or the parent purchasing units will be used to decide which generated subscription items are visible to them. Note that non-catalog items are not immediately available in the catalog view unless you manually rebuild the catalog index to publish the subscription. By default, the index is automatically rebuild every two hours.

Procedure 1. On the Pricing Terms page, click Add Items. 2. Click Create Item. 3. Enter item details as follows:

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Full Description

Enter a description of the item.

Commodity Code

Select a commodity code from the available choices, or click Search for more to se­ lect a different commodity code. Depending on your ERP integration, you may have to enter additional fields, such as Material Group (SAP) or Partitioned Commodity Code (PeopleSoft).

Supplier

Click the link to see more information about the supplier.

Contact

Click the link to see more information about the supplier contact.

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Supplier Part Number

Enter the Supplier Part Number for the item.

Supplier Auxiliary Part ID

Enter the Supplier Auxiliary Part ID for the item.

ERS Allowed

This field is visible only to members of the Contract Manager group. Select Yes to enable automatic creation of invoices for fully approved receipts.

Unit of Measure

Select a unit of measure from the available choices, or click Search for more, to se­ lect a different unit of measure.

Negotiated Price

Enter the negotiated price for the item. Select a currency from the available choices, or click Other to select a different cur­ rency.

Price Unit Quantity Price Unit Unit Conversion Pricing Description

Enter values for the advanced pricing details. For more information, see How to con­ figure pricing for materials and services from a catalog [page 89]. 

Note

The advanced pricing details fields are not applicable for service line items.

4. Click OK. Provide the following information. For this option...

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Description The description options are the same ones you set in the previous step. You can edit them here if necessary. Limits Set Item Limits By

Select Quantity or Amount to determine the method by which the next two options are set.

Minimum Quantity/Amount

For minimum quantity, enter the minimum number of items that must be purchased according to the contract. For minimum amount, enter the minimum amount you are going to spend according to the contract. Select a currency from the available choices, or click Other to select a different cur­ rency.

Maximum Quantity/Amount

For maximum quantity, enter the maximum number of items that can be purchased according to the contract. For maximum amount, enter the maximum amount that can be purchased according to the contract. Select a currency from the available choices, or click Other to select a different cur­ rency.

Tolerance

Managing contract compliance Topics about pricing terms in contracts

Enter a percentage of the maximum quantity or amount by which you can exceed the contract.

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Release Limits (release order con­ tracts only) Minimum Amount / Quantity per Order

Enter the minimum amount or quantity required per line item on a release order. Select a currency from the available choices, or click Other to select a different cur­ rency.

Is Hard Minimum Limit

Specify whether you want to enforce a hard minimum limit on the amount/ quantity per line item. If set to Yes, users cannot submit a requisition if the minimum amount/ quantity of the line item is less than the minimum line item limit defined on the con­ tract. If set to No, additional approval nodes (by default the Contract Manager group) are added as approvers, but users are not prevented from submitting the requisition.

Maximum Amount / Quantity per Order

Enter the maximum amount or quantity allowed per line item on a release order. Select a currency from the available choices, or click Other to select a different cur­ rency.

Maximum Limit Tolerance

Specify the tolerance percentage for the maximum limit.

Is Hard Maximum Limit

Specify whether you want to enforce a hard maximum limit on the amount/ quantity per line item. If set to Yes, users cannot submit a requisition if the amount/quantity of the line item on the requisition exceeds the maximum line item limit (including tol­ erances) defined on the contract. If set to No, additional approval nodes (by default the Contract Manager group) are added, but users are not prevented from submit­ ting the requisition.

Pricing and Discounts None

Select this option if there is no pricing discount according to this contract.

Discounted Price

Select this option if there is a discount price according to this contract. Enter the percent price. Select a currency from the available choices, or click Other to select a different cur­ rency.

Discount Percent

Select this option if there is a percent discount according to this contract. Enter the percent discount (for example, 10%).

Tiered Pricing

Select this option if you are specifying tiered pricing [page 73] for this contract. Click Define Tiers to open the Tiered Pricing page. For more information, see How to define pricing tiers on contracts [page 97].

Term Based Pricing (not available in SAP Ariba Catalog only sites)

Select this option if you are specifying term-based pricing [page 76] for this contract. Click Define Terms to open the Term Based Pricing page. For more information, see How to define term-based pricing [page 98].

Allow Supplier to Edit Service Sheet Unit Price

Available only if the feature to allow suppliers to edit the unit price of items on service sheets after punchin from Ariba Network is enabled for your site: If set to yes, suppliers while creating service sheets can edit the unit price of items added during punchin.

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Term Based Grid Pricing (not avail­ Select this option if you are specifying term-based grid pricing [page 78]. able in SAP Ariba Catalog only sites) Click Define Terms to open the Term Based Grid Pricing page. For more information, see How to define term-based grid pricing [page 99]. Formula Pricing

Select this option if you are specifying formula pricing [page 79]. Click Define Formula to open the Formula Pricing page. For more information, see How to define formula pricing in contracts [page 103].

5. Click Add Additional Items to add more items. Repeat steps 2-3. 6. Click Done when you have finished adding items. 7. Click Edit for an item to edit the accounting information.

How to configure pricing for fixed and recurring fees Context Fixed and recurring fee items are only available for no-release order contracts. Note that creating fixed and recurring fee items always creates a catalog subscriptions. This allows purchasing users to search the catalog for the item, and it automatically applies the contract terms to the item.

Procedure 1. Start the contract wizard [page 51]. 2. Enter general contract definitions [page 52]. 3. Enter contract limits, notification parameters, the preload amount, and forecasted spend [page 57]. 4. Under Fixed and Recurring Fees, click Add Items. 5. Provide the following information: For this option...

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Full Description

Enter a description of the item or service.

Commodity Code

Select a commodity code from the available choices, or click Search for more to select a different commodity code. Depending on your ERP integration, you may have to enter additional fields, such as Material Group (SAP) or Partitioned Commodity Code (People­ Soft).

Amount

Enter the maximum amount that can be spent on the item or service over the life of the contract. If you are creating a contract for recurring fees, then this amount is the maximum amount that can be spent per recurrence.

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For this option...

Do this...

Tolerance

Enter a percentage of the amount by which you can exceed the contract.

Recurring

Select Yes to create a contract for recurring fees. Select No to create a contract for a one-time fee.

Frequency (recurring only)

Select the frequency at which the item is delivered or the service rendered.

Billing Date

Select the date on which the supplier can begin billing you for the item or service.

End Date (recurring only)

Select the date after which you will no longer accept bills for the item or service

Maximum Recurrences

View this read-only field. It is set according to the value of the Frequency option, and the length of the billing period. For example, if the frequency is monthly and the billing period is for one year, the value of this field is 12.

Auto Invoice

This field is visible only to members of the Contract Manager group. Select Yes to enable creation of invoices automatically for fixed and recurring fee items on scheduled dates.

6. Click OK to return to the Pricing Terms page. 7. Click Edit for an item to edit the accounting information. 8. Click OK.

How to configure pricing for costs and expenses Context

Cost and expense items are only available for no-release order contracts. Note that creating cost and expense items always creates a catalog subscriptions. This allows purchasing users to search the catalog for the item, and it automatically applies the contract terms to the item. You cannot receive against cost or expense items as they do not have pricing details.

Procedure

1. Start the contract wizard [page 51]. 2. Enter general contract definitions [page 52]. 3. Enter contract limits, notification parameters, the preload amount, and forecasted spend [page 57]. 4. Under Costs and Expenses, click Add Items. 5. Provide the following information: For this option...

Do this...

Description

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For this option...

Do this...

Full Description

Enter a description of the cost or expense.

Commodity Code

Select a commodity code from the available choices, or click Search for more to select a different commodity code. Depending on your ERP integration, you may have to enter ad­ ditional fields, such as Material Group (SAP) or Partitioned Commodity Code (People­ Soft).

Limits Minimum Amount

Enter the minimum amount you are going to spend according to the contract. Select a currency from the available choices, or click Other to select a different currency.

Maximum Amount

Enter the maximum amount that can be purchased according to the contract. Select a currency from the available choices, or click Other to select a different currency.

Tolerance

Enter a percentage of the maximum amount by which you can exceed the contract.

6. Click OK to return to the Pricing Terms page. 7. Click Edit for an item to edit the accounting information. 8. Click OK.

Results When you have finished configuring pricing, click Next to open the Milestones or Access Control page.

How to define pricing tiers on contracts Context Use the Tiered Pricing page to define tiered pricing for this contract. To access this page, click Define Tiers on the Pricing Terms page. Tiered pricing allows you to specify different discounts based on the volume (either amount or quantity) purchased against the contract. For additional information, see Tiered Pricing [page 73]. The options available on this page change depending upon the type of contract you are creating and the features enabled for your site. If the contract permits only a single type of tiered pricing, the Type and Scope options do not provide choices.

Procedure 1. Use the Type menu to select the type of tiered pricing you want to configure: ○ Amount Based Volume Pricing provides a price discount based on the amount of money you spend. Managing contract compliance Topics about pricing terms in contracts

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○ Amount Based Volume Discount provides a percentage discount based on the amount of money you spend. ○ Quantity Based Volume Pricing provides a price discount based on the quantity you order. ○ Quantity Based Volume Discount provides a percentage discount based on the quantity you order. 2. Use the Scope option to select the scope of the tiered pricing: ○ Cumulative applies once you have met the minimum commitment of the contract.  Note Cumulative pricing is not available in site configured for SAP Ariba Catalog only. Supplier-level and commodity-level contracts are always cumulative. ○ Per Order applies to each release order. 3. Enter the appropriate information for each tier, based on the type of pricing you are using. ○ For Amount Based Volume Pricing, enter the Minimum Amount spent, and the Amount per item at that level of spending. ○ For Amount Based Volume Discount, enter the Minimum Amount spent, and the Percent discount per item at that level of spending. ○ For Quantity Based Volume Pricing, enter the Minimum Quantity purchased, and the Amount per item at that quantity. ○ For Quantity Based Volume Discount pricing, enter the Minimum Quantity purchased, and the Percent discount at that quantity. 4. Click Add to add additional tiers. 5. When you have configured all tiers, click OK. 6. Click OK again to return to the Pricing Terms page, then click Next to open the Milestones page.

How to define term-based pricing Context Use the Term Based Pricing page to define term-based pricing for this contract. To access, click Define Terms on the Pricing Terms page. Term-based pricing allows you to specify different discounts based on specified time periods within the life of the contract. For additional information, see About Term-based Pricing [page 76]. The options available on this page change depending upon the type of contract you are creating. If the contract permits only a single type of term-based pricing, the Type option does not provide choices.  Note Term-based pricing is not available in sites configured for SAP Ariba Catalog only.

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Procedure 1. Use the Type menu to select the type of term pricing you want to configure: ○ Term Based Discount provides a percentage discount based on the time periods you specify. ○ Term Based Pricing provides a price discount based on the time periods you specify. 2. Enter the appropriate information for each period, based on the type of pricing you are using. ○ For Term Based Discount, set the Start Date on which the discount begins (enter a date or click the Calendar and select a date), and enter the Percent by which purchases are discounted. ○ For Term Based Pricing, set the Start Date on which the price begins (enter a date or click the Calendar and select a date), and enter the Amount per item for that period. 3. Click Add to add additional tiers. 4. Click Validate to ensure the terms are complete and valid to calculate the item's price. 5. When you have configured all terms, click OK. 6. Click OK again to return to the Pricing Terms page, then click Next to open the Milestones page.

How to define term-based grid pricing Term-based grid pricing is supported only for partial items in no-release, item-level contracts whose attributes have string values. Term-based grid pricing allows you to specify the price for an item over time, based on attributes of that item, and values for those attributes. For additional information, see Term-based grid pricing in contracts [page 78].  Note Term-based pricing is not available in sited configured for SAP Ariba Catalog only. You define term-based grid pricing on the Term Based Grid Pricing page. The options on this page change according to the type of item for which you are defining pricing (for example, IT Services vs. Airport Locations), but the paradigm is the same for all items.

What are terms Terms define the time periods for which pricing is in effect. A term begins at 00:00:00 AM (midnight) on its start date, and ends at 11:59:59 PM on the day preceding the next term. For example, if you have terms beginning on January 1 and April 1, the first term begins at 00:00:00 AM on January 1 and ends at 11:59:59 PM on March 31. A contract has one default term starting on the effective date of the contract. Each term is identified by its start date. You can add new terms, delete existing terms, and make copies of existing terms. When you make a copy of a term, all of the cell values (pricing for item attributes) for the term are copied to the new term.  Note Once a contract request has been fully approved, you can no longer delete terms from the resulting contract. You can, however, export the contract to Excel, delete terms from the Excel version of the contract, and then Managing contract compliance Topics about pricing terms in contracts

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import that version of the contract. The danger of deleting terms in this fashion is that you lose all the spend data associated with the deleted terms once the new version of the contract is in effect. It is not recommended that you delete terms from a contract that has been approved.

What are cell values

A cell defines the pricing for an item attribute for a specific term. For example, an item like IT Help Desk Services might have attributes like networking and security expert. The attributes represent rows on the grid, while terms represent columns. Cells occur at the intersection of attributes and terms. You edit the cell values to determine pricing.

How to add or copy a term for term-based grid pricing Procedure

1. On the Pricing Terms page, click Add Items to add the item for which you want to define term-based grid pricing. 2. On the Add/Edit Item Level Pricing Terms page, choose Term Based Grid Pricing. 3. Click Define Terms to open the Term Based Grid Pricing page. 4. Click Add Term. 5. Click the calendar control to select a start date. 6. Click OK.

Next Steps

You can also quickly add new terms by copying existing terms: 1. Click Copy Term.  Note The Copy From field defaults to the latest term. 2. Click Select Term to set the value for the Copy From field. 3. Click the radio button for the term you want to copy, then click OK. 4. Set the value of the Copy To field. Use the calendar control to select the start date of the new term. 5. Click OK. The new term is displayed in the appropriate chronological position.

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How to edit the grid for term-based grid pricing Context

You can edit the cell values for one or more item attributes and one or more terms by using the Edit Grid command. When you edit the grid, you specify the terms across which your changes are effective. If you want to restrict your changes to smaller date ranges than are currently defined in the grid, you need to add new terms. If you select multiple item attributes, the same changes are applied to all of them.  Note If your grid contains more terms than can be displayed at one time, you can use the view control to page through the terms to see the ones you want. ● Click Start to page to the first term in the grid. ● Click End to page to the last term in the grid. ● Click the single arrows to page one term at a time. ● Click the double arrows to page six terms at a time. ● Click the calendar control to select a date. The grid then displays a maximum of three terms prior to that date and three terms after that date

Procedure

1. Click the check box for one or more item attributes, or click the check box for the attribute column head to select all attributes. 2. Click Edit Grid. 3. Provide the following information: For this option...

Do this...

From Term

Click Select Term to select the first term in which you want your changes to take ef­ fect.

To Term

Click Select Term to select the last term in which you want your changes to take ef­ fect.

Price

Enter the price for all selected item attributes for the time range you have specified. Click the link to select a currency.

Max. Quantity

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Enter the maximum number of units of all selected item attributes for the time range you have specified.

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For this option...

Do this...

Max. Amount

Enter the maximum amount you will spend for all selected item attributes for the time range you have specified. Click the link to select a currency.

When you are editing the grid by this method, you need to enter values for the Price, Max. Quantity, and Max. Amount fields. If you enter a value for only one field, then the other two fields are set to a null value for all affected attributes. 4. Click OK.

How to edit cell values for term-based grid pricing Procedure

1. Click the link for the cell whose values you want to edit. 2. Provide the following information: For this option...

Do this...

Price

Enter the price for the item attribute for this term. For example, this might be the price per hour for a particular type of temporary labor or the rent per square foot for an airport location. Click the link to select a currency.

Max. Quantity

Enter the maximum number of units for which you will pay during this term. For example, this might be the maximum number of hours of temp labor or the maxi­ mum number of square feet of airport real estate.

Max. Amount

Enter the maximum amount you will spend for this item attribute during this term. For example, the maximum amount you will spend for a security expert or for rent for a ticket gate. Click the link to select a currency.

Amount Spent

This field is read only, and indicates the amount spent so far.

Used Quantity

This field is read only, and indicates the quantity used so far.

3. Click OK.  Note If you plan to export to Excel a contract that contains term-based grid pricing, you must define values for all the cells in the grid. If you export cells with no values, for example Price cells, the currency information is not exported. If you then import an Excel version of that contract without currency information, the system may assign a currency (for example, the default site currency) which may not be what you expect.

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How to define formula pricing in contracts Formula pricing is available when a partial item is added to your contract request. Use the Formula Pricing page to define formula pricing for this contract. Formula pricing allows you to specify a price based on a mathematical formula. Your SAP Ariba solution supports different types of formula pricing, including Matrix and Multiplier pricing. The Formula Pricing page has three areas that you can use in conjunction with one another to define the pricing formula you want to use for an item: ● Create and Validate Pricing Formula, where you combine item attributes, arithmetic operators, functions. ● Add Attributes to Formula, where you can edit and select the attributes you want to add to a formula. ● Define Values for Item Attributes, where you can define values for item attributes and create matrixes. For additional information, see Formula pricing in contracts [page 79] . The examples in the sections that follow use a catalog item Men’s T-Shirt.  Note The examples guide you to using the user interface buttons to develop the formula. Once you are familiar with this process, you can simply type in the formula in the text box and click Validate.

Related Information Creating a Simple Formula for Contract Pricing [page 103] Creating a Pricing Matrix for Contracts [page 104] Creating Multiplier Pricing for Contracts [page 105]

Creating a Simple Formula for Contract Pricing Context In this example, you create a simple formula of BasePrice * Quantity.

Procedure 1. Under Add Attributes to Formula, click Add to formula for the first attribute. 2. In the Create and Validate Pricing Formula area, click the arithmetic operator you want to add to the formula. 3. In the Add Attributes to Formula area, click Add to formula for the second attribute. 4. Click Validate to validate the formula. Managing contract compliance Topics about pricing terms in contracts

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If errors occur during validation, an error message displays. Correct the errors and validate the formula.

Creating a Pricing Matrix for Contracts Context

In this example, you create a formula attribute that specifies a base price of $15.00 for a medium shirt, and a price of $20.00 for a large shirt. That attribute is then incorporated into the formula, wherein the price of the item is determined by quantity and size.

Procedure

1. Under Define Values for Item Attributes, select two values (such as color and size). 2. Click Create Matrix. 3. Provide the following information: For...

Do this...

Formula Attribute Name

Accept the default name, or enter a new name for the formula attribute. The name must:

Value fields

○

Begin with an alphabetic character

○

Contain only alphanumeric characters

○

Use an underscore (_) to separate word pairs

Enter the values you want to use for the attributes. In this example, 15 is used for values in the Medium column, and 20 is used for values in the Large column.

4. Click OK. The new attribute is added to the attributes list. 5. Click Add to formula for Quantity. 6. Click the multiplication operator (*) to add it to the formula. 7. Click Add to formula for the new attribute (for example, color_size). 8. Click OK. The new formula is displayed under Pricing and Discounts. In this example, the price for the line item is calculated as follows: quantity of shirts ordered x price per size For example, a purchase order made under the terms of this contract for 100 medium shirts (100 x 15 = $1500) and 100 large shirts (100 x 20 = $2000) would have an amount of $3500.

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Creating Multiplier Pricing for Contracts Context In this example, you create a formula that specifies the multipliers you want to use against the base price: BasePrice * 1 for medium shirts, and BasePrice * 1.5 for large shirts.

Procedure 1. Under Define Values for Item Attributes, click Define values for an appropriate attribute (for example, size). 2. Provide the following information: For...

Do this...

Formula Attribute Name

Accept the default name, or enter a new name for the formula attribute. The name must:

Value fields

○

Begin with an alphabetic character

○

Contain only alphanumeric characters

○

Use an underscore (_) to separate word pairs

Enter the values you want to use for the attributes. In this example, 1 is used for values in the Medium row, and 1.5 is used for values in the Large row.

3. Click OK. The new attribute is added to the attributes list. 4. Click Add to formula for Quantity. Click the multiplication operator (*), then click the left parenthesis operator ( ( ). Click Add to formula for BasePrice, then click Add to formula for size. Click the right parenthesis operator ( ) ). 5. Click OK. The new formula is displayed under Pricing and Discounts. In this example, the price for the line item is calculated as follows: quantity of shirts x (the base price x the price per size) For example, a purchase order made under the terms of this contract for 100 medium shirts (100 x (15 x 1) = 1500) and 100 large shirts (100 x (15 x 1.5) = $2250) would have an amount of $3750.

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Using Functions in Formula Pricing for Contracts You can define advanced formulas using the following custom functions. To include functions in your formula, type the expression directly into the Formula text box: ● Min: returns the lowest value in a list of values. Example: Min(2,NumColors). If the number of ordered colors is greater than 2, return 2. ● Max: returns the highest value in a list of values. Example: Max(0,NumColors - 2). If the number of ordered colors is less than 2, return 0. ● Curr: associates a currency to the expression Syntax: curr(, "UniqueName of the currency to which the expression value is to be associated") Examples: ○ BasePrice + curr(color, "EUR") where color is the partial field with its pricing grid and BasePrice a pricing value users enter during requisitioning (typically in the user's preferred currency and converted to the site's default currency). During formula evaluation, the curr function ensures that the value for color is converted to the site’s default currency before adding to the BasePrice, so that the result of the calculation is in the default currency. ○ curr(size + color, "EUR") where size and color are partial fields with pricing grids and the pricing values are in Euro. ● If: allows evaluation of conditions Syntax: if (condition-expr, true-expr, false-expr) If condition-expr is True, then the true-expr is evaluated and returned, otherwise false-expr is evaluated and returned. Example: if (x > 0 , 20, 40) returns 20 if x > 0, otherwise it returns 40.  Note You can also use standard math and trigonometric functions supported by the Java Math Expression Parser library, such as: LOG, LN, SQRT, ABS, MOD, SUM, RAND, SIN, COS, TAN, etc.

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Managing compliance contracts with SAP Ariba Contracts

SAP Ariba Procurement solutions provide features and functionality that enable the modeling and management of contract pricing and terms to help support both internal compliance as well as supplier invoice compliance. SAP Ariba Contracts provides visibility and control over the contract authoring and management process. These two solutions can be integrated to allow seamless contract management from authoring to compliance enforcement. If you have contracts that you have already created within your SAP Ariba invoicing or buying solution, and later purchase SAP Ariba Contracts, you can still manage those contracts from your invoicing or buying solution, or you can, from within those contracts, create a contract workspace in SAP Ariba Contracts and manage those contracts from there.  Note After you have SAP Ariba Contracts enabled on your site, you must create all new contracts in SAP Ariba Contracts. For information about managing compliance contracts with SAP Ariba Contracts, see Managing contract spending from contract workspaces. For information about contract authoring in SAP Ariba Contracts, see the Contract authoring guide.

Considerations when using contract compliance with SAP Ariba Contracts ● If yourSAP Ariba Procurement solution is integrated with SAP Ariba Contracts, you cannot create new contracts using your SAP Ariba Procurement solution. Instead, you must create new contracts by first creating a contract workspace in SAP Ariba Contracts. In addition, you cannot import contracts using the Import Contracts data import task in your SAP Ariba Procurement solution. ● After you create a contract workspace for an existing contract in SAP Ariba Contracts, you must do all future work on that contract from the contract workspace. ● Contracts that have a contract workspace associated with them are listed in your SAP Ariba Procurement solution with a “CW” at the beginning of their identifier. For example, CW22211. ● SAP Ariba Contracts uses calendar dates in contracts. These dates are not time zone-specific. Your SAP Ariba Procurement solution uses actual dates, which have a time zone associated with them. Note that due to this time zone difference, dates in contracts can have different interpretations depending on in which application the contract date is specified. ● When a contract workspace is closed in SAP Ariba Contracts, the corresponding contract is closed in the SAP Ariba Procurement solution. ● When a contract workspace is amended in SAP Ariba Contracts, a new version of the corresponding contract is created in the SAP Ariba Procurement solution with the status Open.

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How to create an SAP Ariba Contracts workspace from an existing compliance contract 1. On the Contract Request page of a contract request in the Composing status, click Create Contract Workspace to create a new contract workspace. Or, you can click Add to Contract Workspace to browse existing contract workspaces to which to add contract terms. You can add contract terms to contract workspaces that are not published and do not already have contract terms. 2. Create the contract workspace as directed in the Managing projects, team, documents, and tasks guide. The supplier, effective date, and expiration date are carried over from the contract request to the contract workspace. 3. In the Documents tab of the contract workspace, you will see a Contract Terms document. This document is actually a link into your SAP Ariba Procurement solution. Click its icon and you will return to the original contract request document in your SAP Ariba Procurement solution. When you work on the contract request after it has an associated contract workspace, you notice a Contract Workspace button; click it to access the contract workspace in SAP Ariba Contracts.

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Revision history

The following table provides a brief history of the updates to this guide. SAP Ariba updates the technical documentation for its cloud solutions if: ● Software changes delivered in service packs or hot fixes require a documentation update to correctly reflect the new or changed functionality. ● The existing content is incorrect or user feedback indicated that important content is missing. SAP Ariba reserves the right to update its technical documentation without prior notification. Most documentation updates will be made available in the same week as the software service packs are released, but critical documentation updates may be released at any time. Month/Year of up­ date February 2017

Updated topic ●

Short description

Configuring Pricing

Added a new option that specifies whether suppliers can edit the unit price of

for Materials and

items on service sheets added during punchin.

Services from a Catalog ●

Configuring Pricing for Materials and Services for a NonCatalog Item

●

Configuring the Pricing Terms Page for a Supplier-Level Contract Request

●

Configuring the Pricing Terms Page for a CommodityLevel Contract Re­ quest

April 2017

all

May 2017

●

Restructured and updated with new product/solution names Contract accumula­ Updated with new feature information for invoiced amount accumulator tors

●

changes on contracts

How to define con­ tract limits, notification recipients, and forecasting

June 2017

Automatic creation of

Removed references to tax codes and charges.

contract-based invoices for evaluated receipt set­ tlement

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Month/Year of up­ date August 2017

Updated topic ●

How to configure

Short description Updated information related to the Bill To field value.

pricing terms for a supplier-level con­ tract ●

How to configure pricing for materials and services items from a catalog

How to control edit and

Updated information related to release access permissions.

release access for con­ tracts March 2018

Topics about creating

Added the How to create a contract for autogenerating requisitions topic.

and managing contracts April 2018

How to define general

Added information about Allow change orders against closed contract field.

contract information September 2018

How to define general

Added a note the supplier users can view the contract's available amount.

contract information No-release order con­

Added a note that cost or expense items are not receivable as they do not

tracts

have pricing details

How to configure pricing for costs and expenses October 2018

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Contract request and

Added a note that the site can be configured to not let contracts close auto­

contract statuses

matically even after the maximum limits have been reached.

Managing contract compliance Revision history

Important Disclaimers and Legal Information

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Links with the icon with SAP) to this:

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The content of the linked-to site is not SAP documentation. You may not infer any product claims against SAP based on this information.

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SAP does not agree or disagree with the content on the linked-to site, nor does SAP warrant the availability and correctness. SAP shall not be liable for any damages caused by the use of such content unless damages have been caused by SAP's gross negligence or willful misconduct.

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Gender-Related Language We try not to use gender-specific word forms and formulations. As appropriate for context and readability, SAP may use masculine word forms to refer to all genders.

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