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Procore

Create a Subcontract

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 prime 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 Schedule of Values (SOV) 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 SOV 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 Subcontract' granular permission enabled on your permissions template.
  • Additional Information:
    • An alternative way to create a subcontract is to award a winning bid and convert it into a subcontract. See Award a Winning Bid and Convert it into a Subcontract.
    • To set the accounting method for the subcontract, see How do I set the accounting method for a commitment or prime contract?
    • After creating a subcontract, you have these options for creating change orders:
    • 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) SOV 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®. The commitment must have at least one (1) SOV line item with a QuickBooks® cost code. The cost code does not need to be assigned to a category, because QuickBooks® does not support the category concept.
        • Sage 100 Contractor®. A commitment must have one (1) SOV 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) SOV 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) Schedule of Values (SOV) 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®. 

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 checkmark appears in this box by default. If you do NOT want to sign the subcontract with DocuSign®, remove the mark. To learn how to request signatures when the subcontract is ready, see Complete a Commitment Contract with DocuSign®.
    • #
      Enter or validate the unique identifier for the subcontract. If you are creating the first commitment of a project, Procore automatically numbers the commitment in sequential order. For example, SC-01-001, SC-01-002, and so on.
       Notes
    • 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:
    • Invoice Contacts
      Select one (1) or more employees of the 'Contract Company' to designate as the invoice 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 invoice 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 invoice contacts on your commitments, see Add Invoice Contacts to a Purchase Order or Subcontract and What is an invoice 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 checkbox to denote that the subcontract was fully signed and executed.
       Notes
      • Many Procore users choose to place a checkmark in the Executed box when placing the commitment into the  'Approved' or 'Complete' status.
      • The time at which your project team places a checkmark in the Executed box should always be aligned with your project's unique business process 
    • Private
      Choose from these options:
      • Make this visible to only administrators and the following users
        Mark this checkbox to limit the visibility of the subcontract to users with 'Admin' on the Commitments tool and users specified in the Select a Person drop-down list. 
      • Allow these users to see SOV items
        Mark this checkbox to allow those users selected in the 'Select a Person' drop-down list to see the 'Schedule of Values' tab on the subcontract.
         Important
        When the 'Allow these users to see SOV items' is ON, the 'Schedule of Values' tab is only visible and available to users with 'Admin' level permissions on the project's Commitments tool and the people named in the 'Select a Person' drop-down list. 
      • Select a Person
        Select one or more people from the list. You can allow non-Admin level users to view the subcontract, if desired. Additionally, you can allow selected non-Admin users to have read-only access to the individual line items under the SOV tab. See Manage Permission Templates.
    • Default Retainage
      Specify the percentage amount of retainage to withhold on the first subcontractor invoice. 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.
    • 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 SOV. Click this button to save the new subcontract and jump to the 'Schedule of Values' tab in edit mode. Continue by entering the SOV.
    • 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 Schedule of Values (SOV)

There are two ways to enter the Schedule of Values (SOV) on a subcontract:

Import SOV Line Items from a CSV

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

Add Line Items to the SOV

 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 purchase order or subcontract. Then click Edit.
  3. Click Schedule of Values.
  4. Click Add Line.
  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 SOV 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?
    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?
      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?
      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 QtyUOM, 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 SOV. 
    • Save & Email. Click this button to save the change to the SOV and email the updates to the invoice contact.

See Also 

The Integration by Ryvit is the product of a partnership between Procore and Ryvit, a third-party developer. Viewpoint, Inc. is not affiliated with this connector. All Viewpoint® Vista™ marks and logos are owned by Viewpoint, Inc.

 

If you would like to learn more about Procore’s commitments software and how it can help your business, please visit our construction financials tool product page here.