The Contract represents the terms agreed upon by the Manager of the Source object and the person who is in charge of the connected object (Target objects) in regard to timeframe, budget, and deliverables.
Contracts can only be created if Hierarchical Connections have been created between objects. Contracts are always created and edited at the Source object level. Information is read-only at the Target object level.
Contracts between objects can be illustrated as follows:
The direction of the arrows indicates the direction of the contract: from the “Source” object to the “Target” object. The N-N is a term used to denote a many-to-many relationship (N objects on one side are related to N objects on the opposite side). The term 1-N refers to a one-to-many relationship (1 object on one side is related to objects on the other side).
Only the Manager of the Source Object can open and close the contract.
Each time the Contract is locked, a snapshot is taken and a new version becomes viewable in the Contract History dialog box.
For further information on Budget related to Contracts, please refer to the Project Budget topic.