At default, when creating a Return Authorization (by clicking the Authorize Return on the sales order or invoice), the Check Log Status (found under the Options & Log tab) value will source its information where the return was created from. If the Sales Order or Invoice has a Check Log Status = Processed, the Check Log Status on the Return Authorization will have the same value. If it says Pending on the Sales Order, it will also be Pending on the Return Authorization. But after saving the Return Authorization, Check Log Status will revert to Pending. Take note that if it says processed, it means that R03-SS: Create Contract Items hrly was executed. This means that the next time this script will run transactions with Check Log Status = Processed will be excluded.
In the event that upon initial creation of the Return Authorization the Check Log Status value is equal to Processed and later on the transaction was saved and the Check Log Status did not revert to Pending before the R03-SS: Create Contract Items hrly was executed, this Return Authorization will be excluded on the contract item creation. No negative contract item will be created and the contract will be misstated. If the Check Log Status did not revert to Pending, this means that the form that you have used on the Return Authorization was not included on the Transaction Forms to Deploy Scripts under Contract Renewals>Setup>Contract Renewals Preferences. Make sure to include this form so that the Contract Renewal scripts will run on the form and will set the correct settings.