Create a contract

Create a contract with various contract models, which would act as a binding agreement between the two parties.

Before you begin

Role required:

• For Core UI and Hardware Asset Workspace: admin, contract_manager
• For Enterprise Asset Workspace: sn_eam.enterprise_admin, sn_eam.enterprise_asset_manager
• For Software Asset Workspace: sam_admin, sam_user

About this task

If a contract has one or more associated rate cards, the fields on the Contract form can’t be edited.

Procedure

1. Open the list of contracts that are used across your deployment.
   • If you’re using the Core UI, navigate to All > Contract and select a contract type, such as Insurance, Maintenance, or Service, or select All.
   • If you’re using Hardware Asset Workspace, navigate to the Contract management view and then select the All contracts tab.
   • If you’re using Enterprise Asset Workspace, open the Contract and lease management view and then select the All contracts tab.
   • If you’re using Software Asset Workspace, navigate to License operations > Contracts > Software contracts and select New.
2. Select New.
3. On the form, fill in the fields.
   Not all fields appear on all contract type forms.

   Table 1. Contract or Create New Contract form

   Field	Description
   Contract model	Model the contract is assigned to. For example Lease, Maintenance, Warranty, Service Contract Software License, or Subscription.
   Vendor	Vendor responsible for the contract. This field is required when Purchase Agreement or NDA is selected from Contract model.
   Contract number	Number assigned to the contract by the vendor (required).
   Name	Name of the contract.
   Parent contract	Parent contract of the new contract, if applicable. You can select a parent contract from the contract lookup list.
   Start date	Date on which the contract takes effect. This field is required when Purchase Agreement or NDA is selected from Contract model.
   End date	Date on which the contract expires. Leave the end date empty to create an open-ended contract. This field is required when Purchase Agreement or NDA is selected from Contract model.
   State	Current state of the contract. Draft Active Expired Canceled
   Substate	Current substate of the contract. Awaiting Review Under Review Approved Rejected
   Contract administrator	Person responsible for managing the contract and interacting with the vendor.
   Approver	User who approves or rejects the contract. This list is filtered to only show users with the itil role.
   Business owner	User who manages the contract from a business perspective.
   Agreement type	Agreement type of license: Enterprise SaaS Subscription This field appears only when Maintenance and Software License is selected from Contract model.
   Commitment	Amount committed to spend with this vendor during this time period, from the start to the end of the contract. This field appears only when Purchase Agreement is selected from Contract model.
   Discount	Discount the vendor has agreed to provide. This field appears only when Purchase Agreement is selected from Contract model.
   Process non-contractual SLAs	Option to process both contractual and non-contractual Service Level Agreements (SLAs). This field appears only when Service Contract is selected from Contract model.
   Description	Detailed description of the contract.
   Financial section
   Invoice payment terms	Terms that explain how to pay the contract. For example, Net Monthly Account or Net 30.
   Payment schedule	Schedule that defines when to make payments. For example, Monthly or Annually.
   Payment amount	Amount that has been paid on the contract to date.
   Applicable taxes	Indicates if the contract is exempt from taxes or subject to sales tax.
   Effective tax rate	Effective tax rate to apply to the total cost, if applicable. Effective tax rate is usually the average tax rate charged. This field appears only when Sales is selected from Applicable taxes.
   Tax cost	Total cost of the tax. This field appears only when Sales is selected from Applicable taxes.
   Total cost	Final cost of the contract after adjustments have been applied. If a contract has one or more rate cards, this field shows the combined value of all rate cards. This field appears only when Sales is selected from Applicable taxes.
   Vendor account	Vendor account associated with the contract.
   PO Number	Purchase order number assigned to the contract.
   Cost center	Cost center that is financially responsible for the asset.
   Has rate card	Check box to indicate whether the contract has an associated rate card.
   Renewal section
   Automatically renew	Indicates if the contract can be renewed or extended at the end of its term.
   Options	Duration of the contract renewal or extension. For example, 1 year.
   Renewal start date	Date on which the contract renewal or extension takes effect.
   Renewal end date	Date on which the contract renewal or extension ends.
   Cost adjustment type	Type of cost adjustment applied to the contract. Fixed Manual CPI (Consumer Price Index)
   Cost adjustment amount	Numerical increase or decrease in price of contract. To indicate a decrease in price, enter a negative number. Either a Cost adjustment or Cost adjustment percentage can be specified, but not both.
   Cost adjustment percentage	Percentage increase or decrease in price of contract. To indicate a decrease in price, enter a negative percentage. Either a Cost adjustment or Cost adjustment percentage can be specified, but not both.
   Terms and Conditions section
   Terms and conditions	Specific legal information in the contract.

4. Save the form.
   • If you’re using Core UI, right-click the form header and select Save.
   • If you’re using Hardware Asset Workspace, Software Asset Workspace, or Enterprise Asset Workspace, select Save.
5. Continue entering information in the related lists or tabs that appear.

   Table 3. Contract form related lists or tabs

   Related list or tab	Description
   Assets Covered	Lists all assets covered by this contract.
   Users Covered	Lists all users covered by this contract.
   Contract used by	Lists all configuration items (CI) used in this contract.
   Terms and Conditions	Lists all terms and conditions of this contract.
   Expense Lines	Lists all expense lines in this contract.
   Contract History	Displays the changes to the start and end dates of this contract and changes to the terms and conditions.
   Approval History	Lists all approvals for this contract.
   Service Offerings	Lists all service offerings from this vendor. Activate Service Portfolio Management to see this related list.
   Service Commitments for Contracts	Lists all service commitments for this vendor's offerings. Activate Service Portfolio Management to see this related list.

6. Perform one of the following actions.
   • Select Update to save and exit the contract.
   • Select Submit for Review to send a notification to the approver.

• Create a software maintenance contract example
  One common use case for the Contract Management application is creating a contract to track maintenance payments for enterprise software. You can use this example to learn how to create a software maintenance contract.
• Add an asset to a contract
  You can associate contracts with specific assets, including software licenses.
• Add a user to a contract
  A contract can cover specific users. For example, you may use a contract to hire a group of temporary workers.
• Add a configuration item to a contract
  Contracts can be associated with configuration items. You can link a contract with configuration items to clarify what the contract legally covers.
• Add a document to a contract
  Contracts can be associated with documents. Linking a contract to related documents helps keep all relevant information about a contract together and easily accessible.

Related concepts

• Terms and conditions
• Models
• Contract renewal workflow
• Contracts

Related tasks

• Adjust a contract
• Verify contract administrator assignment for notification
• Send the contract for approval
• Create a contract rate card
• Monitor a contract
• Add a commitment to a service offering

Related reference

• Service Portfolio Management