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(Legacy) Create a Subcontract

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 Legacy Content

This tutorial details Procore's legacy experience for creating a subcontract. The information on this page will be replaced with updated content when the redesigned commitments beta experience is generally available. To learn about this release and its timeline, see Project Financials: Modernized Experience for Commitments.

Important! If you are using the commitments beta experience, please see the Create Subcontracts tutorial instead of the information below. 

Objective

To create a subcontract in Procore using the project's Commitments tool. 

Background

Subcontracts can be awarded during both the preconstruction and construction phases of a project and are typically created and tracked in Procore by project management. After a main contract award, the project manager creates purchase orders and subcontracts for specific trades to secure materials and subcontractor services for a project. 

Things to Consider

  • Required User Permissions:
    • To create a subcontract and see/enter data on the Bill of Quantities (BOQ) tab:
      • 'Admin' level permissions on the project's Commitments tool. 
        OR
      • 'Standard' level permissions on the project's Commitments tool and the 'Allow Users to See BOQ Items' setting must be enabled and your name must be selected in the 'Select a Person' drop-down list
    • To create a subcontract only, 'Read Only' or 'Standard' level permissions on the project's Commitments tool with the 'Create Work Order Contract' granular permission enabled on your permissions template.
  • Additional Information:
    • An alternative way to create a subcontract is to award a winning tender and convert it into a subcontract. See Award a Winning Tender and Convert it into a Subcontract.
    • To set the accounting method for the subcontract, see  How do I set the accounting method for a contract or funding?
    • After creating a subcontract, you have these options for creating variations:

    • For companies using the icon-erp-synced2.png ERP Integrations tool: Show/Hide  

      • In order to send the commitment to the ERP Integrations tool to be accepted for export by an accounting approver:
        • Integration by Ryvit. The commitment must have at least one (1) BOQ line item with a Integration by Ryvit phase code. In addition, the cost code must be assigned to at least one (1) category. See Assign Default Cost Types To Integration by Ryvit Cost Codes). Important! When a commitment is exported to Integration by Ryvit, it must have a unique commitment number. Procore recommends that the numbering convention you set up for the Commitments tool is preceded by the Project Number and then uses the default numbering system. For example, if your Project Number is 001, your numbering system would be 001-001, 001-002, 001-003 and so on. 
        • QuickBooks® Desktop. The commitment must have at least one (1) BOQ line item with a QuickBooks® Desktop cost code. The cost code does not need to be assigned to a category, because QuickBooks® Desktop does not support the category concept.
        • Sage 100 Contractor®. A commitment must have one (1) BOQ line item with a Sage 100 Contractor® cost code. In addition, the cost code must be assigned to at least one (1) cost type. See Assign Default Cost Types To Cost Codes.
        • Sage 300 CRE®. The commitment must have at least one (1) BOQ line item with a Sage 300 CRE® cost code. In addition, the cost code must be assigned to at least one (1) cost type. See Assign Default Cost Types To Cost Codes.
        • Viewpoint® Spectrum®. The commitment must have at least one (1) Bill of Quantities (BOQ) line item with a cost code from the Viewpoint® Spectrum® project. The cost code must be assigned to at least one (1) category. Category assignments must always be updated in Viewpoint® Spectrum®. 
        • Yardi Voyager®. The commitment must have at least one (1) BOQ line item with a Yardi Voyager® cost code. In addition, the cost code must be assigned to at least one (1) cost type. See Refresh the Yardi Voyager® Cost Codes on a Project.
        • Sage Intacct®. The commitment must have at least one (1) BOQ line item with a Sage Intacct® cost code. In addition, the cost code must be assigned to at least one (1) cost type. See Assign Default Cost Types To Cost Codes.
        • Acumatica Cloud ERP. The commitment must have at least one (1) BOQ line item with a Acumatica Cloud ERP cost code. In addition, the cost code must be assigned to at least one (1) cost type. See Assign Default Cost Types To Cost Codes.
        • MRI Platform X®. The commitment must have at least one (1) BOQ line item with a MRI Platform X® cost code. In addition, the cost code must be assigned to at least one (1) cost type. See Assign Default Cost Types To Cost Codes.
        • Xero™. The commitment must have at least one (1) BOQ line item with a Xero™ cost code. In addition, the cost code must be assigned to at least one (1) cost type. See Assign Default Cost Types To Cost Codes.

      For companies using the icon-erp-synced2.png ERP Integrations tool: Show/Hide  

      • In order to send the commitment to the ERP Integrations tool to be accepted for export by an accounting approver:
        • MYOB Advanced Construction. The commitment must have at least one (1) BOQ line item with a MYOB Advanced Construction cost code. In addition, the cost code must be assigned to at least one (1) cost type. See Assign Default Cost Types To Cost Codes.

Prerequisites

Steps

Step 1: Create a Subcontract

  1. Navigate to the project's Commitments tool.
  2. Click +Create and select Subcontract from the drop-down menu.
    create-commitment.png
  3. In the 'General' tab under 'General Information', do the following:
    subcontract-general-tab.png
    • Sign with DocuSign®
      If you have enabled the Procore + DocuSign® integration (see Enable or Disable the DocuSign® Integration on a Procore Project), a tick appears in this box by default. If you do NOT want to collect signatures with DocuSign®, remove the mark.
    • Number #
      Accept the default number, enter a new number or create a custom numbering scheme.

      For companies using the icon-erp-synced2.png ERP Integrations tool: Show/Hide  

       Tip
      How are numbers assigned? To learn how Procore assigns numbers and to understand your custom numbering options, see How are commitments, contracts and changes numbered in Procore?
    • Title
      Enter a descriptive title for the subcontract. 
       Notes
    • Contract Company
      Select the company responsible for completing the work on the subcontract (for example, American Construction Co.).
      Notes:
    • Payment application Contacts
      Select one (1) or more employees of the 'Contract Company' to designate as the payment application contact(s). After saving the subcontract, any users added here will be added to the 'Private' list. You must select a 'Contract Company' before you can select payment application contacts. 
       Note
      It is important to always add at least one  'Invoice Contact' on a purchase order or subcontract. This ensures that important email invitations and automatic email notifications are sent to the appropriate contact. To learn more about the importance of including payment application contacts on your commitments, see Add Payment application Contacts to a Purchase Order or Subcontract and What is a payment application contact? 
    • Status
      Assign a status to the subcontract. To learn about the available statuses and which commitment statuses reflect contract amounts in your project's budget, see What are the default commitment statuses in Procore? 
    • Executed. Mark this tickbox to denote that the subcontract was fully signed and executed.
       Notes
      • Many Procore users choose to place a tick in the Executed box when placing the commitment into the  'Approved' or 'Complete' status.
      • The time at which your project team places a tick in the Executed box should always be aligned with your project's unique business process 
    • Private
      Mark the tickboxes and choose any project users or collaborators from the 'Select a Person' list. To learn more about the privacy options, see Change the Privacy Settings for a Commitment.
      • Make this visible to only administrators and the following users
        Mark this tickbox to limit the visibility of the purchase order to users with 'Admin' on the project's Commitments tool and users specified in the 'Select a Person' drop-down list. 
      • Allow these users to see BOQ items
        Mark this tickbox in this box to limit the visibility of the Bill of Quantities (BOQ) items on the purchase order to users with 'Admin' on the project's Commitments tool and users specified in the 'Select a Person' drop-down list. 
    • Default Retention
      Specify the percentage amount of retention to withhold on the first subcontractor payment application. For example, it is a common practice to enter 5 or 10% in this field. 
       Notes
    • Description
      Provide additional information, as necessary.
    • Attachments. Attach any related materials such as pricing quotes, receipts, signed purchase orders and so on. You may attach files that have been uploaded to your project or drag and drop files from your local computer.
  4. Scroll to the Contract Dates section and enter the following:
    subcontract-contract-dates.png
    • Start Date. Select the date when the scope of work will begin on the job site.
    • Estimated Completion Date. Select the estimated date of when the scope of work will be finished.
       In Beta
      Note to users participating in the Site-initiated Variations' limited release beta program. The information below details a configuration that is available to Procore users taking part in the Beta Participant Program for Site-initiated Variations. For more information about this release, see Commitments: Allow Collaborators to Submit Site-initiated Variations. 
    • Signed Contract Received Date. Select the date when the subcontract was officially signed.
    • Actual Completion Date. Select the date when the scope of work was deemed complete.
  5. Scroll to the Additional Information section and enter the following:
    subcontract-inclusions-exclusions.png
    • Inclusions. Disclose any inclusions that may not be clearly stated in the related contract documents.
    • Exclusions. Disclose any exclusions that may not be clearly stated in the related contract documents.
  6. Click one (1) of these buttons:
    • Create. Click this button to save the new subcontract and return to the 'General' tab in view mode. 
    • Create & Enter BOQ. Click this button to save the new subcontract and jump to the 'Bill of Quantities' tab in edit mode. Continue by entering the BOQ.
    • Complete with DocuSign®. Click this button to complete the subcontract with the DocuSign® integration. See Complete a Commitment Contract with DocuSign®.

Step 2: Enter the Bill of Quantities (BOQ)

There are two ways to enter the Bill of Quantities (BOQ) on a subcontract:

Import BOQ Line Items from a CSV

If you want to import multiple line items to an BOQ, the Commitments tool provides users with a CSV template that you can download, complete and then upload to Procore. For instructions, see Import Commitment BOQ Line Items from a CSV File.

Add Line Items to the BOQ

 Notes
  • If your company is using the Procore + Integration by Ryvit integration and your Integration by Ryvit system is configured to use the Calculated Method, Integration by Ryvit will NOT allow the use of Lump Sum (LS) as a unit of measurement.
  • If you are using the 'Override Subtotal', you must ONLY input the Subtotal Amount. The Integration by Ryvit integration will then create an 'LS' item in Integration by Ryvit.
  1. Navigate to the project's Commitments tool.
  2. Under the Contracts tab, locate the commitment to update. Then click Edit.
  3. Click Bill of Quantities.
  4. Click Add Line.
     Note
     If the 'Enable Always Editable Bill of Quantities' setting is turned ON in the Commitments tool, users with the required user permission to Edit a Commitment can modify the Bill of Quantities while a commitment is in any status. To learn more, see What is the 'Enable Always Editable Bill of Quantities' setting?
  5. Follow the appropriate steps depending on whether your accounting method is Amount Based or Unit/Quantity Based:
     Note
    To edit your accounting method before adding BOQ line items, see Edit the Advanced Settings Tab on a Commitment. To learn more, see How do I set the accounting method for a contract or funding?
    1. For contracts using the Amount Based accounting method:
      1. #
        Automatically enters a line item number in sequential order. 
      2. Change Event Line Item
        If you have change events enabled, you can select a change event line item if the commitment needs to be linked to a change event. 
      3. Budget Code
        Select a budget code from the list or click Create Budget Code to create a new one. See What is a budget code in Procore's WBS? 
      4. Description
        Enter a description for the line item. For example, type: Monthly Service Fee
      5. Amount
        Enter the amount of the cost.
      6. Billed to Date
        The system automatically calculates the amount billed on the commitment up to the current date.  
      7. Amount Remaining
        Enter the amount that has NOT been billed to the current date. 
      8. Tax Code
        Enter a tax code to use for this line item. This field only appears if you have enabled the tax codes feature. See How can I use tax codes on a project?
    2. For contracts using the Unit/Quantity Based accounting method:
      1. #
        Automatically enters a line item number in sequential order. 
      2. Change Event Line Item
        If you have change events enabled, you can select a change event line item if the commitment needs to be linked to a change event. 
      3. Budget Code
        Select a budget code from the list or click Create Budget Code to create a new one. See What is a budget code in Procore's WBS? 
      4. Description
        Enter a description for the line item. For example, type: Monthly Service Fee
      5. Qty
        Enter the number of units.
      6. UoM
        Enter the Unit of Measure (UoM).
         Notes
      7. Unit Cost
        Enter the Unit Cost in the box provided.
      8. Amount
        The system automatically calculates the subtotal for you, based on the Qty, UOM, and Unit Cost entries. 
      9. Billed to Date
        The system automatically calculates the amount billed on the commitment up to the current date. 
      10. Amount Remaining
        Enter the amount that has NOT been billed to the current date. 
      11. Tax Code
        Enter a tax code to use for this line item. This field only appears if you have enabled the tax codes feature. See How can I use tax codes on a project?
  6. Choose one of these options:
    • Save. Click this button to save the changes to the BOQ. 
    • Save & Email. Click this button to save the change to the BOQ and email the updates to the payment application contact.