Using the Subcontractor Feature

To use the Subcontractor feature, you must add the subcontractors or vendors to the job and assign the subcontractor to a cost code. When the vendor's invoice arrives for payment, you create a payables transaction entry and distribute the invoice to the job and cost code. If you selected the Pay When Paid setup option, the voucher is put on payment hold. You can release the hold on the payables transaction after you have been paid. Once the subcontractor's job is complete, you generate retention invoices.

Editing Accounts Payable subcontractor retention is not supported. The Subcontractor Module is not updated when an Accounts Payable subcontractor transaction is edited.

Adding subcontractors to a job record

Adding subcontractors to a job record involves the following:

Step 1: Assign a subcontractor to a job

You can enter information to a job regarding your vendors and subcontractors in the Subcontractors Maintenance window. The vendor record must exist in Microsoft Dynamics GP before it can be added to a Job Cost record.

1. Choose Cards > Job Cost > Job.
2. Choose a job, then choose Subs/Vendors.
3. Complete the following fields, as necessary.
   • Job Vendor, Address
     Enter a job vendor, or choose Add Vendors to choose a vendor and let the Job Vendor and Address fields default from the vendor record.
   • Hold
     This checkbox is used with the Advanced Subcontractor feature. For more information, see Advanced subcontractor feature.
   • Vendor Contract Type
     Choose a vendor contract type from the drop-down list. Choices are NTE, Lump Sum, and Unit Price.
   • Contract Date, Purchase Order #
     Enter the Contract Date and Purchase Order Number.

   • Retention %
     This amount defaults from the Job Maintenance record. You can choose the expansion button to open the Retention window, which allows you to specify a maximum retention amount for the current contract. Enter a Maximum Percent of Contract Amount Withheld and choose OK. The retention withheld percent will be withheld from the subcontractor's invoices until the maximum retention amount is reached. Once the maximum amount is withheld, no more retention will be withheld for the subcontractor on the job. 

     

     Retention will not be withheld if a job has a billing type of SOP.

   • Mod Rate
     Enter the modification rate of the contractor. This field is informational only.
   • User-defined
     Enter user-defined information. These fields are informational only.
   • Bonded, Lien Waiver on File, Insurance Certificate, Insurance Expr. Date
     Mark these checkboxes if applicable. If the Insurance Certificate checkbox is marked, the Insurance Expr. Date field is enabled. Enter the date the insurance expires.
   • Submit Date, Resubmit Date, Approved Date, Disapproved Date
     Enter the submit date, resubmit date, approved date, and disapproved date.
   • Original Contract Amt
     Enter the original contract amount. This amount will be used to calculate the amended contract amount after any change orders. For information on fields automatically updated, see Viewing updated subcontractor information.
4. To print the Subcontractor Status report, choose File > Print.
5. Choose Save.

Step 2: Assign a subcontractor to a cost code.

The subcontractor must be assigned to a cost code for retention to be calculated.

1. Choose Cards > Job Cost > Job.
2. Choose a job, then choose Cost Codes.
3. Choose Add Cost Codes to add a cost code for the subcontractor on the selected job. You must add a cost code with a cost element other than Labor.
4. From the Transaction Type drop-down list, choose Vendor ID. The Transaction Type drop-down list is only visible when a cost code with a cost element other than Labor is displayed.

5. Choose a Vendor. Accounts payable or purchase order transactions posted to a subcontractor cost code will automatically have retention withheld, based on the retention percent assigned to the subcontractor in the Subcontractors Maintenance window. 

   

   You can assign numerous cost codes to a vendor, but only one vendor to a cost code. You can assign more than one vendor to a cost code using the Advanced Subcontractor feature.

6. Choose Save.
7. Close the Job Cost Codes Setup window.
8. Choose Save in the Subcontractors Maintenance window and the Job Maintenance window.

Distributing a payable to a job and cost code

When the vendor's invoice arrives for payment, you must create a payables transaction and distribute the invoice to the correct job and cost code. This allows retention to be withheld.

1. Choose Transactions > Purchasing > Transaction Entry.
2. Complete the Payables Transaction Entry window. See the Microsoft – Microsoft Dynamics GP Purchase Order Processing Manual for information on completing this window. For Credit Memos and Invoices to appear correctly on the SRS Subcontractor Detail Report, the following steps must be taken during Payables Transaction Entry:
   • The original PO number for a credit memo or invoice must be entered in the Payables Transaction Entry window.
   • A credit memo must be distributed and posted to the job associated with the original purchasing transaction (Invoice/Shipment or Invoice Match) using the original subcontractor cost code associated with that job.
   • A credit memo must be applied to the document created by the original purchasing transaction.

3. Choose Distributions. 

   

   Do not edit a payables transaction that contains retention.

4. From the Product Indicator drop-down list, choose Job Cost.
5. Enter a Job Number and Cost Code for the subcontractor. The expense amount for the cost code in the Debit field appears as the default. If you enter a return or a credit memo, the amount appears in the Credit field. The cost code displays automatically if you set up default payables cost codes in Job Cost and assigned the cost code to the job by distribution type.
6. Enter amounts, complete the distribution, and choose OK. See Entering payables transactions for details. Retention will be automatically calculated and distributed.
7. In the Payables Transaction Entry window, choose Post.

• While intercompany transactions can be used with Job Cost subcontractors, information such as retention will not be updated in the destination company.
• Separate accounts payable debit distribution amounts are not created for retention amounts. Instead, the accounts payable credit account is decreased by the amount of the retention.

Releasing a payables hold

If the Pay When Paid option is marked in the Subcontractor Setup window and a vendor's invoice has been distributed to a Job and a Cost Code, the transaction record is marked on payment hold. You can release the hold on the payables transaction after you have been paid by the customer and are ready to pay the subcontractor.

1. Choose Transactions > Job Cost > Subcontractor Payments.
2. Choose a Job.
3. In the scrolling window, choose Mark All or mark individual transactions to release. To view transaction information, choose the document number of a marked transaction and zoom on the Apply to Document field. In the Payables Transaction Entry Zoom window, you can choose the Distributions button to view distribution information.
4. Choose Process in the Subcontractors Payments window. A message appears asking if you are sure you want to process the payments. Choose Process. The hold on the payable is released so the subcontractor can be paid with the next check run.

Generating retention invoices

Once the subcontractor's job is complete to everyone's satisfaction, the retention amount can be paid.

1. Choose Transactions > Job Cost > Subcontractor Retention.
2. Choose a Job.
3. In the scrolling window, mark individual retention invoices or choose Mark All to create retention vouchers in Payables Management. To view information on a transaction, choose the document number of a marked transaction and zoom on the Apply to Document field. In the Payables Transaction Entry Zoom window, choose Distributions to view distribution information.
4. Choose Process in the Subcontractors Retention window. A message appears asking if you are sure you want to process the retention transactions. Choose Process. This creates a payables batch with the user ID as its name. A payable voucher is created for each marked item. You can process a portion of the retention amount in increments by entering an amount in the Retention % field before choosing Process; only that partial amount will be processed.
5. Post the batch in Payables Management. See the Microsoft Dynamics GP Payables Management Manual for more information.

Viewing updated subcontractor information

After the subcontractor's job is complete and retention invoices have been generated, the Subcontractors Maintenance window is updated to record the vendor and retention invoices. The Vendor Invoices field shows the total of all vendor invoices posted. The Retention Withheld field shows the total retention amount of all posted invoices. The Retention Invoices field represents the retention invoices that have been processed. The Total field shows the total vendor invoices.

1. Choose Cards > Job Cost > Job.
2. Choose a job, then choose Subs/Vendors.

Reconciling jobs with subcontractors

You can run the reconcile procedure for jobs with subcontractors or vendors to verify the information in transaction open files. Reconciling adjusts the totals in the master files if a discrepancy exists, and identifies posted transactions that contain invalid data. You can reconcile for a specific job, a range of jobs, or all jobs that have subcontractors. Back up your Job Cost data files before running reconcile. Make sure no one is logged into Microsoft Dynamics GP when you reconcile Job Cost data files. If other users are logged in, an alert message appears, and the Job Cost reconcile process will not run to completion.

1. Choose Microsoft Dynamics GP > Tools > Utilities > Job Cost > Reconcile Subcontractors.
2. Use the lookup buttons in the From and To fields to choose a range of jobs.
3. Choose Insert >>.
4. Choose Reconcile.
5. Choose Yes to the message asking if you want to reconcile.