Contruent Blog

Invoice and Contract Management with Contruent Enterprise

Contract management within Contruent Enterprise is a robust tool for owners, EPCs and construction management firms. Contruent Enterprise’s contract management is a core requirement for many customers around the world, including Abu Dhabi Airports (ADAC), Dubai Expo 2020, and many others. The invoice and contract management feature has the capabilities to:

  • Record contract bids, perform bid analysis and award contracts
  • Record and monitor contract invoices and payments
  • Record and monitor contract insurances and bonds
  • Manage contract changes (instructions and executions)
  • Fully integrate with cost management
  • Record ownership (restrict access control of specific contracts to specific users)
  • Handle advanced payments, retention and progress payments
  • Handle taxes, deductions, discounts and damages/penalties
  • Print customized payment certificates and appendices
  • Provide a set of standardized and custom reports
  • Evaluate contract performance
  • Provide a complete audit trail
  • And much more…

Two key areas when it comes to contract management are Invoices/Payment Certificates management and Contract Changes. These two areas are critical to the operations of customers in the Middle East and worldwide.

Invoice Management

The majority of contracts in the Middle East require payment certificates to be split into at least three types, namely Retention Release, Advanced Payments and Progress Payments.

Contruent can support all three types, in addition to mixed types, which requires some invoices/certificates to include a mix of progress, advanced and retention release values in the same invoice, and for the same line item. These mixed certificates are common in the Middle East (ME) and are handled in Contruent Enterprise. Clients also have benefited from the system’s ability to print out customized forms of payment certificates (contractor/consultant) along with back up appendices.

For every payment certificate, clients need the option to submit the cost of work in place, recover advanced payments, recover retention, apply tax and any deductions/discounts/penalties.

This can be handled at a pay-item level, where each pay item is also linked to a cost control account, and the net certified values are auto calculated.

Contract Changes

Change management is used to formally track Approved Scope Changes, Budget Transfers, Contingency Draw-Downs, Provisions, etc. The change management process can be summarized into the below stages:

Contract Change Instructions are the first step in the life cycle of change in contracts. An Instruction needs to be tied to a change order, to ensure that budget has been allocated. An Instruction provides a contractor with permission to commence the work. Values of Instructions can be tracked against every pay item, as a “Pending Cost” value, which impacts the EAC of the contract.

Like change orders, approvals for instructions and/or executions can be managed through workflows/events.

Once the work is completed, and the final value of the pay item has been determined, a change execution is issued and is linked to the change instruction. The final value would appear as an Approved Change, impacting the revised price of the contract

Invoice management and contract change management have seen numerous enhancements in the recent Contruent Enterprise builds to accommodate the growing client needs for effective contract management. A new case study, featuring one of Contruent’s key customers in the Middle East, Abu Dhabi Airports, has recently been released, featuring the different modules they use, especially the contracts feature. You can read it here.