Use Contracts for agreements with a defined total value over a contract term, where revenue or expense recognition may differ from when cash is billed or collected.
This is the right schedule for a client engagement, licensing deal, or vendor commitment whose value comes from the agreement itself rather than units times price.
If the business logic is really units multiplied by price, use Products & Services instead.
Create the contract shell first
Add a contract from Schedules > Contracts; it opens in a modal inside the schedule workspace.
Set the core contract details:
- Name
- Category
- Type
- Recognition Method
- Total Value
- Start Date / End Date
- Initial Account Allocations
Recognition Method is important: today the active contract-recognition method is Straight Line.
Add billing terms after the contract exists
After you create the contract, open it from By Contract and work in the Billing Schedule section.
That section lets you add terms inline with:
- Start Period
- End Period
- Amount
- Timing
Billing terms describe when cash moves; recognition terms describe when the value is earned.
What flows to the statements
Contracts have two separate outputs:
- Recognition Schedule - how the contract value hits the P&L
- Billing Schedule - how cash timing is expected to land
If billing timing and recognition timing differ, the gap creates AR or AP behavior in the model.
Review the right views
- By Contract to review individual agreements
- By Account to see where contract output lands
- Summary for rolled-up schedule output
Watch out for
- Total value alone does not define cash timing; billing terms still need to be set separately from recognition allocation.