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    Minna Muikku
    Invoicing against contract
    Topic posted May 24, 2019 by Minna MuikkuSilver Medal: 2,000+ Points 
    39 Views, 3 Comments
    Invoicing against contract
    Is this kind of feature available in Fusion

    In some other systems there is a functionality where you can match an invoice against a contract (instead of a PO). This can be used e.g expenses like facility rent, electricity, cleaning,insurances and so on.

    Is this kind of functionality available in Fusion? If not, how do other customers handle this type of expenses?






    • Suman Guha

      Hi Minna,

      Could you please elaborate on the business value that you are looking for by way of this feature?

      Is it primarily for ensuring that you are paying at the contracted rates? Or are there other considerations?

      Also am moving this to the Payables forum for insight from the Payables team.


      • Minna Muikku

        Hi Suman,

        Sure. Different ERP systems have different variations about this, but the basic idea is the same: There are some (service) spend categories in which creating POs adds little value to the buy process, yet you still need to ensure compliance and avoid time-consuming manual invoice handling. Examples of these categories: Security services, Cleaning, Landscaping, Electricity, and so on. These services are usually invoiced regularly based on e.g monthly fees.

        So instead of creating POs or handling these invoices manually in AP,  you create a contract document for certain supplier for certain budgeted amount, with start and end date, purchasing category, charge account and payment terms and, and the invoices would be matched against this contract. When it comes to invoice approval, there could be 3 different options:

        - automatic approval until contract amount is full

        - invoice approval workflow based on cost center or

        - FYI notification for approver that invoice is matched to contract and automatically approved



        • Suman Guha

          Hi Minna,

          Thanks for the details.

          For your requirements, wondering if you could simply use a Purchase Order document with embedded contract terms and conditions where the Purchase Order line is of a Fixed Price Service line type carrying an amount equivalent to the budgeted amount.

          Invoices would follow the normal matching to purchase order process for such amount based lines until the cumulative billed amount exceeds the PO amount.