Overview

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This article demonstrates how to create a Cost Reimbursable Contract in order to bill external customers. The procedures to complete this process includes setting up a contract, creating an event, and invoicing. 

Essential Information

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• You will need the following OFC roles to prepare Invoices for external billing:
• • PPM Budget and Contract Manager
  • AR Inquiry and Reporting
  • To request the roles, use the Oracle and Concur Role Requests form.
• All Invoices should be processed through Oracle Financial and receivables directed to the Central Cashier.
• Payments should not be mailed to departments.
• Billing must be initiated in PPM for Revenue to post to a Project and Task.
• An active Contract and Event are needed to create an Invoice through PPM billing.
• There are 3 procedures to completing this process
  
  • Set up a Contract
    
    • Confirm that there is an active Project, Task, and Customer set up in Oracle before creating a contract.
    • All contracts MUST have a customer and a price (even if it is an estimate).
  • Create an Event
    
    • Must have an Event in order to create an Invoice.
    • An Event can not be put on multiple Invoices.
    • An Invoice can have multiple Events.
  • Invoicing
    
    • The system generates invoices once a day at 8:15 am. Therefore, any invoices created after 8:15 am will be available the following day, unless a future date was entered.
    • Campus Users can also run the Generate Invoices job per contract to populate individual PPM invoices using KB0033947: How to run the Generate Invoices job.
    • The option to create manual invoices is highly discouraged due to PPM/AR mismatch issues during the collection of payments and while monitoring outstanding balances.

• As costs occur on Projects, if the Billable column is checked in Manage Project Costs, the line will be picked up on a Cost Reimbursable setup

Next Steps 

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Procedure A: Set up a Cost Reimbursable Contract

1. Log into Oracle Financials Cloud (OFC) using single sign-on.
2. Select Projects and Awards, then click on Contracts.
3. On the right-hand side, click on the Tasks icon for the drop-down menu, under Contracts, select Manage Contract Templates.
4. To create a Service Agreement, which is for department use:
   
   1. Search using the following method.
      
      1. in Template Number, enter "Service" and then click Search.
   2. Under Search Results, highlight the Service Agreement line.
   3. Click on Actions and select Create Contract from Template.
   4. In the Create Contract from Template dialog box, open the Primary Party drop-down and select Search.
   5. Enter the customer Name or Party Number and select Search, highlight the desired customer and select OK.
   6. Start Date will default to today’s date, change it as needed.
   7. Enter an End Date, even though it is not required with an asterisk *
      
      1. You will get an error if an End Date is not entered.
      2. If this is available in the contract, it must be entered into the system.
   8. Click OK
5. Navigate to the Overview tab:
   
   1. The Name will default to Service Agreements.
   2. Under Additional Information, enter the Revenue Account that the Contract should collect Revenue on and the Fund Number that the contract revenue should post to; if unknown, use the Search function from the drop-down.
      
      1. The following Funds will be rejected: 13991, 13992, 20000, 20400, 20700
   3. Click Save on the top.
6. Navigate to the Billing tab:
   
   1. Enter the Contract Organization, which is the UCSD department.
   2. In Transaction Type, enter PA Invoice, you will have to search for the words "PA Invoice."
   3. If a recurring PO Number is provided by the customer that is to be stated on every customer Invoice, enter PO Number.
   4. Net invoice: check mark
   5. Under the Bill Plans section, a default Bill Plan will already be created, complete the following segments:
      
      1. Bill Plan
         
         1. Name (rename if desired)
         2. Method Name: Cost Reimbursable Invoice
            
         3. Invoice Method Classification: Rate Based
      2. Customer Information
         
         1. Bill-to Account Number
         2. Bill-to Contact (required to prevent contract exceptions)
         3. Bill-to Site
      3. Invoice Information
         
         1. Billing Cycle (almost always select Immediate to generate invoices immediately upon creation)
         2. Payment Terms
      4. Invoice Grouping Options
         
         1. Invoice Grouping: Associated project (required to make the proper Event Types available in Events [Milestone, Fee, Other])
      5. Invoice Summarization Options
         
         1. Labor Format: UCSD Labor
         2. Nonlabor Format: UCSD Nonlabor
         3. Event Format: UCSD Events
         4. Save
      6. Associated Contract Lines
         
         1. Select + Sign
         2. Search, then highlight the Bill Plan Number at the bottom.
         3. Select Submit
      7. Save and Close
   6. Under the Revenue Plans section, a default Revenue Plan will already be created, complete the following segments:
      
      1. Revenue Plan
         
         1. Name (rename if desired)
         2. Method Name: As Billed Revenue
         3. Revenue Method Classification: As Billed or As Incurred.
         4. Press Save
      2. Associated Contract Lines
         
         1. Select + Sign
         2. Search, then highlight the Revenue Plan Number at the bottom.
         3. Select Submit
      3. Save and Close
   7. DO NOT add any Billing Resources to the Billing Controls segment.
   8. Click on Save
7. Navigate to the Lines tab.
   
   1. Navigate to the Overview mini-tab.
      
      1. Update Line Name as desired.
      2. Enter Line Amount, Estimated Variable Consideration Amount, and Standalone Selling Price with the dollar amount of the Contract.
      3. Contracts may NOT have a $0.00 line amount.
      4. Click on Save
   2. Navigate to the Billing mini-tab.
      
      1. Confirm that Bill Plan and Revenue Plan fields are populated and accurate (if not, add them from the drop-down menus).
      2. (Enter the same PO Number if entered in the Billing main tab).
      3. DO NOT add any Billing Resources to the Billing Controls segment.
      4. To add Sales Tax under Tax Control section, select the necessary code under Classification Code drop-down (separate Contract Lines will be required if there are taxable and non-taxable Events).
      5. When Sales Tax is added, invoices MUST be generated through the system overnight (manually created invoices will NOT generate the Sales Tax).
   3. Navigate to the Associated Projects mini-tab.
      
      1. Click on the + sign, then enter the following:
         
         1. Project Name which will auto-populate Project Number.
         2. Task Name
         3. Funded Amount
8. Navigate to the Parties tab:
   
   1. Confirm your Customer and Supplier names.
   2. In the Accounts section, complete the following which is required even though they do not have an asterisk *
      
      1. Bill-to Account Number
      2. Bill-to Site
      3. Ship-to Account Number (search by Bill-to Account number)
      4. Ship-to Site
      5. Click on Update Lines
      6. Enter a Bill-to Contact if the field is empty, then click the Update button.
9. Click on Save, then Submit:
   
   1. Submit to Approvers
   2. If there are no validation errors, click Next to continue.
   3. If the option to click Next is not available or if you can not move forward, recheck that all required fields above are populated.
   4. Use the drop-down to Save and Close.
10. Make a note of generated Contract Number which is needed to create Event and Invoice.

Project Administration will Review and Approve, approval could be up to 72 hours, once approved, it will become an active Contract. If you encounter any error messages during the contract creation process, please refer to KB0033600: How to Resolve a PPM Contract Creation Error Messages (OKC-195742 and OKC-196156).

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Procedure B: Create an Event

In order to create an Invoice, an Event must be first created. An Event can not be put on multiple Invoices, but an Invoice can have multiple Events.

1. Select Projects and Awards, then click on Contract Invoices.
2. On the right-hand side, click on the Tasks icon for the drop-down menu, in Review and Adjust, select Manage Events.
3. In the Search Results, click on the + sign to create a new Event, enter the following:
   
   1. Business Unit with "UCSD Campus"
   2. Contract Number
   3. Contract Line
   4. Event Number is automatically assigned
   5. Event Type must be:
      
      1. Milestone -  Event to invoice and recognize revenue for a specified amount based on a milestone.
      2. Fee - Event to invoice and recognize revenue for fees earned.
      3. Other - Event to invoice and recognize revenue for a specified amount.
   6. Completion Date (if a future date is entered, the invoice will not generate until that date).
   7. Amount in Bill Transaction Currency is the amount of the Invoice.
   8. Project Name
   9. Project Number
   10. Transaction Task Name
   11. Transaction Task Number and Associated Task Name: populates from Task Name.
   12. In the Additional Information section, multiple services can be entered to display on the final invoice (the following fields are all optional).
       
       1. Customer PO
       2. Customer Contact
       3. UOM (Unit of Measurement) i.e. EA, box, pound, etc. or can be left blank.
       4. Quantity (the Quantity x Unit Price must match the Amount in Bill Transaction Currency as the system will not auto check the calculations, which may result in sending incorrect invoices to the customer).
       5. Unit Price (this field allows up to 4 decimal digits to be referenced to provide more granularity in the AR invoice i.e. 306.1979).
4. Click Save and Close > Done
   
5. From here, a Draft Invoice is created once daily at 8:15 am or run the Generate Invoices Job (KB0033947) (referenced in the next section).

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Procedure C: Invoicing

System Generated Invoices

• • This is an automatic process that will run once a day at 8:15 am. This means that any invoices you create after that time will be available the following day, unless a future date was entered on the event.
  • Campus Users can also run the Generate Invoices job per contract to populate individual PPM invoices using KB0033947: How to run the Generate Invoices job.
  • Do not manually create invoices as it does not allow required validations to take place: i.e. sales tax calculations, project number is not captured and passed from PPM to AR.

1. Retrieve the Draft Invoice:
   
   1. Click on the Contract Invoices module, which opens to the Overview tab.
   2. Under the Invoice Processing Status section, click on the Draft Invoices tab (see screenshot below).
      
   3. Click on the Filter icon, and you can search by entering the Contract Number to find the Draft Invoice.
   4. Select the desired Draft Invoice hyperlink.
   5. On the Invoice Overview tab, review and make changes as needed, make sure to click on Save when making changes.
   6. To add attachments to the Invoice, select Show More.
      
      1. Next to Attachments None, select the + sign, and add the desired documents on the popup screen, and select OK.
2. Submit the Invoice for Approval, the status will stay in draft until it is submitted to Project Administration for Review/Approval.

Invoice Status is Submit

• When the status of the Invoice is Submit, it can not be edited or deleted.
• If you need to change the Invoice before it is approved, you will need to contact Project Administration.
• Accounts Receivable will need to reject it and it will return to Draft status, then you would be able to make edits and submit the Invoice again.

What to expect after you submit an invoice

• Accounts Receivable will review and approve.
  
  • The status of the Invoice will change to Approve.
• Accounts Receivable will then release the Invoice to Accounts Receivable.
  
  • The status of the Invoice will change to Release.
• Accounts Receivable will run scheduled processes to finalize Invoice.
  
  • The status will change to Transfer and when completed in Accounts Receivable it will change to Accepted.
  • If there is an error, the status will change to Transfer Rejected.
• If the customer is set up with an email, an automatic message will be sent, otherwise, the department will need to send the Invoice to the customer.