Contractor services are defined as work services provided by an organization or person who is not an employee of your company. Contractors are paid for their work based on an agreed upon contract or agreement. For example, a contractor
service may be a painting service. It is also important to associate the purchasing transactions, such as the requisition and purchase order, to the Work Order. In order for this to be executed, the appropriate steps must be completed in Purchasing and Enterprise Asset Management.
Outside Service Processing provides the functionality to create items that are contractor services, such as landscaping, include these items on a Work Order, and execute the related purchasing transactions as the Work Order is released. By creating a contract service as an Outside Service Processing item, the purchasing requisition is created when the Work Order is Released. The additional purchasing transaction, including the creation of the purchase order, the approval, and invoicing process, are then managed by Purchasing. This optional process ensures that the actual charges are applied to the Work Order.
The other option is to enable Standard Rate. This applies pre-determined standard rates, for contractor services, to the Work Order, without invoking the purchasing transaction.