Recurring costs from contracts
Recurring costs from contracts are one of the largest cost blocks in the fleet. For this reason, we have invested a lot of work, that these costs are included in the total cost of accounting.
The following contracts can be created in Avrios. The costs from these contracts are automatically transferred to your cost accounting:
- insurance contract
- maintenance contract
- purchasing contract
- long term rental (or short term rental agreement)
- loan agreement
You create a contract as follows
Just click on the contract you want to create and follow the dialogue.
What do I have to do, in order for the contract costs to appear in the cost accounting?
Nothing, Avrios automatically calculates, based on the contract period, how long the contract costs should be included in the cost accounting.
What happens if I cancel my contracts early or extend my contract?
That depends on the level of detail of the change. In fact, if only the contract term changes, go to the vehicle file of the affected vehicle under Contracts and click the three small dots and then click Edit Current Contract. (see the screenshot)
Important note: Please note, all changes you make here apply to the entire specified contract period. For example, if you change the lease rate under Edit Current Contract, Avrios assumes that these changes have been in effect since the contract started. If the changes do not apply until a specific key date, please select "Add contract adjustment". If you are unsure which option is right for you, contact your Avrios representative or feel free to open a chat with us.
When should I choose the option "Edit current contract"?
If the contract information is valid for the entire contract term.
You returned a vehicle earlier on 01.06.2017 and canceled your insurance. The contract originally ran until 31.12.2017. Your insurance company accepts the cancellation on 01.07.2017. That means until then costs arise for you, but not beyond this date. Originally you would have had to pay the insurance until 31.12.17. To illustrate this, simply go to "Adjust current contract" under the insurance contract concerned and change the end of the contract to 01.07. The system only charges you the costs up to this key date (01.07.).
How do I make contract adjustments?
In general, it is important to define what contract adjustments are. Contract adjustments in Avrios are all changes that are not made for the entire contract period, or if you want to understand the history of a contract and the changes. Each time you select Add Contract Customization, Avrios creates a new version of the contract. In this version, you must determine from when this version should be valid.
Let's take a look at an example:
You have a lease that runs from 31.12.2015 and should run until 15.03.2018, with a lease of 400 €. You decide to keep the vehicle for three more months. Your leassor will charge you for these three months on the same contract but the costs are now 450 €. At this moment, the contract with all it’s framework remains the same, but is still considered a new version at a higher rate. You pay this rate from 15.03.2018. Before this date, Avrios still expects costs of 400 €. This is how we make sure that the total cost accounting works.
Correct calculation (with adapted contract)
Lease: 31.12.2015 - 15.03.2018: 400 € x 39.5 months = 15 800 €
Lease: 15.03.2018 - 15.06.2018: 450 € x 3 months = 1 350 €
Total 17 150€
Wrong calculation (without contract adjustment)
Lease: 31.12.2015 - 15.06.2018: 400€ x 42.5 months= 17 000€
Do I have to upload PDF contract invoices in Avrios, so that the costs are registered in the system?
No, on the contrary, for a faster digitization experience for all customers, Avrios actively rejects PDF contract invoices if they are recognized as such. If an invoice goes through digitization, the system always prioritizes the actual amount that emerges from the deposited contract. This applies to all contract settlements with the exception of leasing final invoices or leasing invoices that include a non-contractual service, such as the delivery of a vehicle. These amounts are not covered by the amount in the leasing contract and are therefore included in the costs of the contractual costs.
How are credits handled on contract invoices?
For example, if you receive a credit from your insurance company because you have not used the contract until the end, then the right way is to adjust the contract duration for this contract. This ensures that your total cost of sales calculation is guaranteed. Be careful not to upload the associated credit to Avrios. This would result in the shortened contract term and credit being summed, leading to an unrealistically low and incorrect value.
I have to adjust several contracts at once. How do I do that?
Mass changes always mean a more complex intrusion into the database. To ensure that your data is in order and everything is displayed correctly, such activities are performed exclusively by administrators from Avrios. Get in touch with your contact person via chat, email or telephone or write an email to email@example.com