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1. What is this module about
The Contract module Module in Workplace Management is designed to facilitate users to register and manage streamlines the registration and management of contracts with customers, suppliers, and partners. Register the It enables users to track financial obligations—whether monthly, quarterly or yearly financial obligations associated to the contract. Straight forward contract periods (extend yearly) and deviating contract periods (1st renewal after 5 year, 2nd renewal after 2 year and after that a yearly renewal) are supported. Receive contract notification emails, if contracts are about to expire or automatcially extended, or annually—associated with each contract. Key features include contract indexing, automated generation of index letters, and invoicing capabilities. Additionally, users can receive automated notifications for upcoming contract expirations or renewals, ensuring proactive contract management.
The next parts will go into more detail on some of the core concepts of this module.
1.1 Contract periods (and schemes)
The start date and end date dates of the contract, when the contract needs to be or will be automatically renewed and from which date it is no longer possible to terminate the contract because of an automatic renewal is determine by the contracts a contract, as well as its automatic renewal settings and termination deadlines, are determined by the contract period scheme(s) and contract period.
Contract
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Period Scheme(s): The period scheme(s)
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define how the contract
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operates in terms of
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start and end
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dates,
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renewal
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methods, and
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notice periods for termination.
Contract
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Period:
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Refers to the actual
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duration of the contract, spanning from the start date
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to the end date.
Via the contracts 'Period schemes' tab, the period scheme(s) can be managed:
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So one or more period schemes are used to automatically determine the contracts period. There is always one contract period which corresponds with one or more contract period schemes.
1.2 Contract items
Contracts often involve financial obligations for one or both parties. These obligations are managed using contract items, which allow you to define and track specific financial responsibilities within a contract.
A contract usually consists of financial obligations for one of the contract parties. Via contract items these financial obligations can be registered in the contract. Contract items are created to get insights on the total contracts value and to be able to invoice these contract items. More information on contract invoicing in one of the chapters below.contract can include one or multiple contract items, depending on its complexity. Contract items enable you to break down and manage different obligations separately, providing flexibility and transparency.
Key benefits of contract Items
Transparency: Clearly define and track financial obligations for various aspects of the contract.
Flexibility: Easily adapt contract details over time by adding, modifying, or removing items as needed.
Examples of how contract items can be used
Maintenance Contracts: For contracts covering multiple buildings or assets, each related object can be assigned its own contract item. This approach allows you to track financial obligations per object and specify the periods during which each object is linked to the contract by setting distinct start and end dates for each item.
Separation of Costs: In a rental agreement, for instance, rental costs and service costs can be managed as separate contract items. This separation ensures that each financial obligation is tracked independently while remaining part of the same contract.
Contract items and indexing
Contract items also play a crucial role during contract indexing:
Each relevant contract item is duplicated.
The original items are assigned an end date corresponding to the index date.
The new items are assigned a start date from the index date and updated with the new amounts.
Active-, historical- and future contract items
Within the contract there is a distinction between active-, historical- and future contract items. These contract items can be managed via the corresponding overviews to prevent all contract items being in one whole list and the user needs to search for the active contract items.
Active contract items: Contract items currently active.
Historical contract items: Contract items ended in the past.
Future contract items: Contract items with startdate start date in the future.
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Contract items can be added in a few different ways:
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Next to price changes, it is also possible to index via an indiceindices. An indice indices is a list of percentages or values which are used to determine the indexation percentage. Usually these indice indices values are provided by a government or specific authority. An example: Consumer price indexes (CPIs) are index numbers that measure changes in the prices of goods and services purchased or otherwise acquired by households.
These indices need to be manually created and maintained in Workplace Management. If a specific indice indices is applicable for a contract item, it can be linked to the contract item and will automatically be taken into account when the actual indexation is executed.
Indices can be managed via the menu option ‘Contracts' → 'Indices’:
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The indice indices can be one of three types:
Percentage: Change the price with a percentage (e.g. the price is increased by 1,5%).
Value: Change the price with a percentage. The percentage of indexation is calculated by two values in the indiceindices, depending on the index period and delay period of the contract.
Fixed value: Change the price with a fixed value (e.g. the price is increased by 100).
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