Cost Management

The ServiceNow Cost Management application tracks configuration item costs. The costs can be
allocated to business units and used in reports.
The previous name of this application was Financial Management. In this release, other financial
management applications are available: see Financial Management and Finance Service Automation.
Cost management enables these features:
 Using rate cards.
 Defining configuration item (CI) costs.
 Tracking one-time costs for CIs.
 Processing recurring CI costs to generate expense lines.
 Distributing bulk costs to multiple expense line sources.
 Tracking costs related to tasks and projects.
 Aggregating configuration item costs and charging the total cost to a business service or
application.
 Allocating expense lines to business units with flexible allocation rules.
 Tracking planned and actual budget costs by cost center.

Cost Management Options

Use the following cost management options to plan and control business costs.
Create rate cards to properly track configuration item, contract, task, and labor costs.
Create expense lines and expense allocation rules.
Aggregate configuration item costs and apply the total cost to a business service or application using
relationship paths.
Create distribution costs and distribution cost rules to divide costs between a group of records.

CI RATE CARD
A configuration item (CI) rate card is a group of recurring configuration item costs associated with
multiple configuration items.
Setup of each of these rate cards involves:
Creating a CI rate cards against CIs. You can pick the CIs with a filter or manually. Establishing a rate
card cost for those Cis For example, you'll likely setup CI rate cards for certain types of servers or
network equipment.
You can tell how much an individual CI truly costs in terms of leases, purchases, and maintenance.
ServiceNow uses Expense Lines, to add up all those costs. Also, expense lines can be aggregated to
apply all configuration item expenses to a parent business service or application with relationship
paths.

CONTRACT RATE CARD

Capture operating costs by generating expense lines representing the cost of a contract. Associate a
contract to certain assets and costs of those assets are tied to the contract.
This is similar to a rate card cost, except the contract contains all the costs. Where as with a rate
card cost the costs accumulate.

TASK RATE CARDS

Task rate cards are templates used to define the type of task and the method of calculating the
associated costs. They can help you determine the costs of a P1 incident or an emergency change for
example.
There is two versions of Task Rate cards, a flat rate and "time worked" version of Task Rate Cards.
The Time Worked version uses the "Use Time Worked" checkbox. That way users can add up all the
time spent on an incident and ServiceNow will automatically multiply it by their labor rate card to
find out how much that incident or change really cost.

LABOR RATE CARDS

Labor rate cards are templates used to define worker's labor rates when calculating task cost based
on time worked. Uses a reference only rate code to align rates with an external system.
You will likely get labor rate cards from HR or Finance and will have to import them into the system.
They are somewhat secret, but are only approximations of labor costs. Sometimes you match labor
rate cards to a User's Title or Department, but usually Title.
More information on how these rate cards work: Cost Sources

USING DISTRIBUTION COSTS AND RULES

Distribution Costs are costs which can be divided among a group of records. For example, the cost of
power at a datacenter which can be divided among the CIs in the datacenter. Distribution Rules
determine how the Distribution Costs are divided among the CIs.

ALLOCATING EXPENSES
Expenses can also be allocated to a business entity that is responsible for the expense.
This is not considered charge-back or billing but could be used as a source for billing. The primary
purpose of expense allocation is to represent the consumer of the process that has incurred some
expense. This can be accomplished by defining expense allocation rules.
By using Expense Allocation Rules, you can distribute the costs to multiple departments, cost centers,
or groups.
Contract Management
A contract is a binding agreement between two parties.
In the ServiceNow platform, contracts contain detailed information such as contract number, start
and end dates, active status, terms and conditions statements, documents, renewal information,
Contracts follow a lifecycle based on state and substate. This determines when they can be edited
and when they are in compliance (expiration).

CONTRACT STATES
Draft: User adds information about the contract and specifies an approver.
Active: Contract was approved and has reached the specified start date.
Expired: Contract reached the specified end date. Expired contracts with an active renewal workflow
that are waiting for approval have a substate of Awaiting Review. Expired contracts with an active
renewal workflow where the renewal was approved, but the renewal date has not yet passed, have
a substate of Renewal Approved. Expired contracts with no active renewal or extension pending
workflow have an empty substate.
Canceled: Contract was discontinued and is no longer active.

CONTRACT SUBSTATES
Awaiting Review: Contract is being prepared for review.
Under Review: Contract is sent to the approver and the approver is reviewing the contract.
Approved: Contract is reviewed and accepted by the approver.
Rejected: Contract is reviewed and declined by the approver.
Renewal Approved: Contract renewal is approved by the approver.
Renewal Rejected: Contract renewal is rejected by the approver.
Extension Approved: Contract extension is approved by the approver.
Extension Rejected: Contract extension is rejected by the approver.
None: No substate is specified.

Contract Management application is used to create various types of contracts, such as leases,
warranties, maintenance, and service.
You can add additional information to contracts, such as the following.
 Assets covered by the contract
 Users covered by the contract
 Terms and conditions associated with the contract
 Other documents related to the contract
Track the various stages of a contract from draft to closure by viewing contract history and running
reports. Adjust, extend, and renew active contracts.

For more information on how to create contracts: Create a Contract

Create a contract rate card

A contract rate card provides detailed price information for a contract and enables you to generate
expense lines for recurring expenses automatically. There can be multiple rate cards for the same
contract.
Consider the following case: an organization has a contract with a third-party company, which
oversees technical operations in the organization's data centers. The contract costs to use a specific
server model in the New York data center are different from using the same server model in the
London data center. There are two rate cards to detail these costs separately.