Main Contract
Definition
Main contractUse
The possible uses of the main contract are demonstrated in the following example.
To get an overview of your LI-objects, create a lease-in as a vendor general contract.
This object is subject to additional contracts with other parties such as:
a. Utility companies who stipulate that their receivables (for example, for power, water, telephone) are cleared directly and not via a landlord service charge settlement.
b. Parties granted usage authorization for a restricted usage right (such as right of way) in return for a fee.
This information can be portrayed by one of the following:
1. Option A: Contract hierarchy: use a main contract (containing various contracts)
Contracts with utility companies are portrayed as vendor general contracts whereas contracts with parties with usage authorization are portrayed as customer general contracts.
Group these contracts together and assign them to the lease-in as a general contract in the General Data tab.
2. Option B: General contract
You can portray the various contracts and contract relationships in one contract by:
a. Creating a vendor/customer general contract
b. Entering vendor items (your payments to the landlord and utility companies) and customer items (payments to your company from parties with usage authorization) in to this contract.
We recommend using this variant only if all of the contract data such as contract terms, periods of notice, renewal options and so on are exactly the same for all participating contract parties.
Advantages/Disadvantages | |
Main contract with contract hierarchy |
A contract contains more than one contractual relationship |
Posting procedures are necessary for each contract |
Only one posting procedure per period for all items |
Different contract data (adjustment type/contract term/periods of notice/authorization) have to be maintained for each contract |
Only possible to clearly portray contract data if the contracts in the general contract contain identical contract data. |