Contruction Management Contracts

OBJECTIVE

The Construction Management Contracts option allows to bill a customer based on the work progress, as well as marking up cost prices according to a predetermined profit percentage and adding administration fees if desired.

 

PREREQUISITES

• Project Management
• Customer Management
• Salesperson Management
• Billing Groups

 

ICONS

Construction Management Contracts icons

Only the icons specific to this window are defined in the table below.

Icon	Title	Used to
	Insert a total row	In the Billing Schedule tab, allows to add a total line under the selected line in the grid.
	Import Activities from Project	Allows a user to import activities from the project in the billing schedule grid. NOTE: Contrary to the Progress Billing Contract option, it is not mandatory to enter a GROUP before the activity import. Furthermore, only activities from the project identified as being billable are included in the import.
	Recalculate Table (F9)	Recalculate data and refresh the grid in the Billing Schedule tab.
	Unlock the amounts/quantities already invoiced	Allow the modification of invoiced amounts and quantities.
	Form Configuration	Create and print personalized forms. The forms will also be available in Contract Management and in Contract Management Cost plus.

 

Steps

maestro* > Invoicing > Contractual Billing > Construction Management > Construction Management Contracts

 

Creating a Construction Management Contract

1. Click on the icon New.
2. Enter the required information:

Field	Description
Number	The contract number is the same as the project number. This is the project number associated with the contract. NOTE: The icon is used to select a project whereas the […] button is used to select an existing contract.
Description	Description of the project. NOTE: If the description is modified, it is updated in Project Management.
Division	Used to enter the project's division.
Status	Displays the status of the contract.
Closing Date	Displays the closing date of the contract.

3. Enter the required information in the Project Description tab:

1. Details section:

Field	Description
Site	Project (contract) site from Contact Management. NOTE: If a site type contact is selected, the contact information is displayed on the screen (address, province, postal code, etc.).
Address	If no site is selected, the following fields must be completed: Address, City, Province, Postal Code, Telephone, Country/Region, ZIP Code, Telephone, and Fax.
Site Manager	Name of the person responsible for the site entered in Project Management.
Customer Code	Code of the customer to be invoiced from Customer Management. NOTE: If no customer is identified in the project but entered on the contract, maestro* will update the project upon saving.
US Tax Code	Code of U.S. taxes to apply to sales linked to this contract. This tax code is derived from the DefineTaxCodes and applies only if the Management of US Sales Taxes is enabled, in the General Ledger configuration.
Salesperson	Code of the salesperson proposed by default for all invoices under the contract. This code is from Salesperson Management. NOTE: If a salesperson is registered in the project, it is proposed by default.
Main Customer	Main customer code from Customer Management. NOTE: Identifies the customer who provided the work to be done, but who does not receive the invoice. It is possible to print certain reports by main customer.

2. Details subtab:

Field	Description
Payment Terms	Payment term applicable to this contract. NOTES: If no term is specified, maestro* uses the term from Customer Management. The payment term is used to calculate the due date of the invoice. The payment term can also be entered at the time of invoicing.
Purchase Order	Purchase order number for the contract. NOTE: This purchase order number is displayed on the invoicing window and is also available when printing the Accounts Receivable List.
Production No.	Production number for the contract. NOTE: Available for information purposes only.
Customer Project	Customer's project number. NOTE: If the Lien Management option is installed, the customer project created with this option can be selected.
Cost Rate	Percentage for generating an adjusting accounting entry for work in progress (WIP) if managed as active.
Progress	Greyed-in field since the progress is systematically by rate for construction management contracts.
Detailed Holdback	When checked, this box allows to specify the different holdback rates for construction management invoices.
Group	Default revenue group.
Holdback %	Holdback percentage applicable to all invoices for the contract. NOTES: This percentage is applicable by default when invoicing, but it is possible to change it. If a rate is entered in the Holdback Rate section in the Project, that rate is displayed.
Start Date	Project start date entered in Project Management.
Delivery Date	Project delivery date entered in Project Management.
Provisional Date	Expected invoicing date for the holdback.
Invoice Form	Allows to identify the form used to print the invoice of the contract. NOTE: If a form is specified, the latter will have priority over every other forms specified in the Customer Management and Configuration options. If left empty, maestro* will use the form defined in the Customer Management option. Otherwise, it will use the form specified in the Configuration option for construction management billing.

3. GL Accounts subtab:

If no account is entered, maestro* uses the account defined in the activity, or the account in Configuration.

Field	Description
Sale	General ledger account to which income is posted.
Change Order	General ledger account to which change order income is posted. NOTE: This can be the same account as the Sale field if no distinction is made between sales and change order.

4. Totals section:

Field	Description
Contract	Original amount of the contract before taxes.
Credit	Credit amounts granted.
Invoiced to Date	Amount invoiced to date.
Holdback to Date	Holdback invoiced to date.
Total without Holdback	Total amount of the contract including credits. NOTE: The total amount does not include the holdback amounts.
GST/PST	Taxes calculated on the contract and change orders based on the taxes defined in Customer Management.
Total to Date	Grand total invoiced including taxes.
Cumulative Work in Process	Cumulative amount of work in progress (WIP) for the contract. NOTE: This field cannot be changed by the user. It is only calculated if the Cost Rates field is completed.
Holdback to Invoice – Contract	Amount of holdbacks to be invoiced on the original contract. NOTE: This field represents the value of holdbacks that have not been posted and must be invoiced. Updated if the Transfer of Holdbacks option is set to No or Postponed. This setting is in General Settings, Contractual Billing section, under General.
Holdback Receipt	Amount in holdbacks received.
Receipt	Amount cashed in receipts on the contract.
Total Stored Material	Total estimated amount of stored material. NOTE: This amount is for informational purposes only and can be displayed in the invoice form.
Stored Material Invoiced	Stored material that has been invoiced to date. NOTE: This amount is updated following invoicing and can be displayed on the invoice form.

5. The Long Term Holdbacks section displays the holdback amounts summary entered in the Billing Schedule tab:

Champ	Description
Warranty	Displays the original amount, the invoiced amount, and the long-term holdback balance for the warranty.
Maintenance	Displays the original amount, the invoiced amount, and the long-term holdback balance for maintenance.
Other	Displays the original amount, the invoiced amount, and other long-term holdback balances.

4. The Additional Fields tab allows the user to personalize the Construction Management Contracts option by adding fields. Click the Configuration button to do so.
5. Complete the Billing Schedule tab's grid:

It is possible to import activities that have a selling budget in the project by using the Import Activities from Project icon. It is possible to unlock contracts so that quantities or amounts for already invoiced lines can be changed by clicking the Unlock the amounts/quantities alreadyinvoiced icon. However, it is impossible to unlock lines with invoices that are being processed (invoices entered, but not transferred). Finally, it is impossible to modify the progress bill if an invoice is not transferred.

 

Column	Description
Code	Code identifying the work done. NOTES: This field is limited to 20 alphanumerical characters. This code can be the activity number or the number displayed on the estimate. Furthermore, it is possible to view progress bills already configured in the Billing Schedule option by using the F7 key.
Long-Term Holdback	Available values: Warranty Allows to define a progress line as being a longterm holdback for warranties. Maintenance Allows to define a progress line as being a longterm holdback for maintenance work. Other Allows to define a progress line as being another type of longterm holdback. NOTES: These holdbacks are completed independently from regular holdbacks and are therefore excluded from the processing of the latter. Furthermore, the workings of additional longterm holdbacks do not depend of any other configuration concerning regular holdbacks. If the column does not appear under the Billing Schedule tab, make a right-clic in the grind and select Configuration. Check the corresponding View box, then click Ok to close the window.
Project	Determines to which project the income is applied.
Activity	Determines to which activity the income is applied.
Revenue Group	Determines to which group the income is applied.
Billing Schedule - Description	Description of the construction work displayed on the invoice.
Billing Schedule - Amount	Amount to invoice.
Invoiced to Date	Progress Rate Displays the invoice's progress percentage. Invoiced Amount invoiced to this day upon the moment it is recorded and transferred to the Sales team. NOTE: Available for informational purposes only.
To Complete	% Complete Remaining percentage to complete for the item. Amount Remaining amount to complete for the item.
Holdback	% Displays the billing schedule's holdback percentage. Amount Invoiced to Date Holdback amount invoiced to date. NOTE: These columns only appear if the Detailed Holdback box is checked in the Details section, under the Project Description tab, of the Construction Management Contracts option.
To Print	Tells maestro* to print the line on the invoice if the box is checked. NOTE: It is possible to define default values for detail and total lines by clicking on the Configuration icon.
Total	Tells maestro* to display a total only if the box is checked.
Comment Summary	Comments.
Comments	Memo. NOTE: For informational purposes only.
Invoicing	Indicates if a non-transferred invoice exists for this specific line and contract. If checked, the line cannot be modified.

6. Enter the required information in the Change Order tab:

The totals can be entered in the change order layout by clicking the Insert a total row icon. It is possible to unlock contracts so that quantities or amounts for already invoiced lines can be changed by clicking the Unlock the amounts/quantities alreadyinvoiced icon. However, it is impossible to unlock lines with invoices that are being processed (invoices entered, but not transferred).

 

Field	Description
Details	Brief description of the customer's change order. NOTE: This description is displayed during invoicing if the To Print field is checked.
Project	Project to which the change order is posted. NOTE: The project may linked to a sub-project. There can be EITHER one activity per change order and that activity cannot be reused for another change order, OR one sub-project per change order and that sub-project cannot be reused for another change order.
Activity	Invoicing activity for the change order. NOTE: There can be EITHER one activity per change order and that activity cannot be reused for another change order, OR one sub-project per change order and that sub-project cannot be reused for another change order.
Revenue Group	Revenue group for the change order.
Change Order	Progress Invoicing progress percentage or quantity for the change order. Requested Amount requested for the change order. NOTE: This information is included on the Invoicing Suggestion report available by clicking the Print icon. Approved Amount approved by the customer for the change order. NOTE: We recommend entering the amount approved by the customer before invoicing to see the amount requested versus the amount approved on the Invoicing Suggestion report.
Invoiced to Date	Progress Rate   Invoiced Amount invoiced to date for the change order if the invoice is posted and transferred to sales. NOTE: Available for information purposes only. Hlbk to Bill Amount of the holdback to be invoiced on change orders if holdback accounting is set to No or Postponed. NOTE: Available for information purposes only.
To Complete	% Complete Percentage to complete on the change order. Amount Amount to complete on the change order.
To Print	Indicates that the change order will be printed on the invoice, if the box is checked.
Total	Only indicates the total on the invoice, if the box is checked.
Contract Amendment Date	Date of the change order.
Directive No	Directive number. NOTE: This information is included on the Invoicing Suggestion report.
Presentation Date	Date on which the directive is presented to the customer. NOTE: This information is included on the Invoicing Suggestion report.
Purchase Order	Used to enter the customer’s purchase order number by change order. NOTE: This information is included on the Invoicing Suggestion report.
Comment Summary	Comment on the change order.
Comments	Memo. NOTE: Available for information purposes only.
Change Order Type	Invoicing method for the change order. NOTE: The change order cannot be invoiced using a method other than the method selected. Three values are possible: Contract Invoicing, Cost Plus Invoicing or Construction Management.
Estimate Number	Estimate number from the Quotation module. NOTE: Available for information purposes only.
Change Order Number	Change order number if the line was created from Change Order Management.

7. Enter the required information in the Management tab:

1. Details section:

Field	Description
Billing Group	Group used only for invoicing labour. NOTE: Groups are configured in Billing Groups. They are used to establish selling prices applicable to the contract.
Attach cost transation documents to sales invoices	When checked, this configuration allows to attach the documents related to the original invoiced transactions (project purchase, project hours entry, project order invoice) to the invoice. NOTE: Once the invoice has been generated, the documents appear in the Invoice's Document Management. The user can choose to send them as an attachement: Separated, in their original format; Separated, in PDF format; Regrouped in a single PDF file.
Change Order Processing Mode	Available values: By Activity Each change order has to be associated to a specific activity that differs from the activity used on the contract, in the Billing Schedule tab. By Sub-Projects Each change order is linked to a specific sub-project, which is also linked to a master project.

2. Profit and Administration section:

Field	Description
Invoicing Method	Available values: Included With administration costs and profit included in the cost invoiced on reports. Separated Administration costs and profit displayed separately on reports.

3. Progress Billing section:

Maestro* applies the percentage based on the expense group used for invoicing.

Field	Description
Revenue Activity	Allows to indicate the activity that will be used to post the profits and administration fees calculated during invoicing. NOTES: A single activity will be used to post the profit and administration fees. A different activity than the once entered in the Change Order section can be used.
Rate	Administration Percentage of administrative costs to be calculated for material, labour, subcontractor, equipment and miscellaneous expenses applicable to the contract. Available fields:  Material Labour Subcontractor Equipment Miscellaneous Profit Percentage of profit to be calculated for material, labour, subcontractor, equipment and miscellaneous expenses applicable to the contract. Available fields:  Material Labour Subcontractor Equipment Miscellaneous NOTE: The profit is calculated on the cost of the work plus the cost of administration.

4. Change Order section:

Maestro* applies the percentage based on the expense group used for invoicing.

Field	Description
Revenue Activity	Allows to indicate the activity that will be used to post the profits and administration fees calculated during invoicing. NOTES: A single activity will be used to post the profit and administration fees. A different activity than the once entered in the Progress Billing section can be used.
Rate	Administration Percentage of administrative costs to be calculated for material, labour, subcontractor, equipment and miscellaneous expenses applicable to the contract. Available fields:  Material Labour Subcontractor Equipment Miscellaneous Profit Percentage of profit to be calculated for material, labour, subcontractor, equipment and miscellaneous expenses applicable to the contract. Available fields:  Material Labour Subcontractor Equipment Miscellaneous NOTE: The profit is calculated on the cost of the work plus the cost of administration.

8. Click Save.

 

See also

• Construction Management Billing
• Progress Billing Templates

 

Last modification: November 12, 2024