Financials > Closing processes > Revenue recognition validation 

Use this function to process revenue recognition for multiple projects. You can search based on specific criteria and then calculate, validate, and post selected projects. You can search for a range of projects or analytical dimensions in the related fields according to the rule. Only projects that have the selected revenue recognition code assigned are available.

You can also adjust calculated amounts for certain Column types and access individual revenue recognition records for each project.

See Revenue recognition calculation to process revenue for a single project.

About Revenue recognition

As a complement to the Project management (PJM) module, revenue recognition allows you to determine the method in which each project recognizes the revenue based on one of three methods:

Manual percentage entry

Percentage of costs with estimated margin at completion

Percentage of costs without estimated margin at completion

These methods, in conjunction with the project-related journal entries to the deferred revenue and cost accounts, allows the Revenue recognition function to calculate the values that should be recognized and then posted to the revenue and cost accounts.

Setup

After you have defined a Revenue recognition code in Revenue recognition rules, you can assign that code to projects in Project management. Before calculating revenue recognition for a period, you need to select the Revenue recognition checkbox in Financial snapshots. This way, you have the most up-to-date values for any of the project-related calculation such as estimated cost at completion and subsequent calculations.

Calculating and posting

When a project milestone or a performance obligation is met, you can calculate, validate, and then post the recognized amount. The Revenue recognition function is used to generate entries for a single Revenue recognition code and Project. When you want to process revenue for multiple projects, you can use the Revenue recognition validation function to process entries in a workbench format.

Prerequisites

SEEREFERTTO Refer to documentation Implementation

Screen management

Header

Fields

The following fields are present on this tab :

Criteria

Enter an existing Revenue recognition code.

This field displays information from the Revenue recognition code setup and cannot be modified.

  • Description (field DESTRA)

 

  • Calculation basis (field REVTYP)

 

  • Dimension type (field DIE)

 

  • Ledger type (field LEDTYP)

This field displays information from the Revenue recognition code setup and cannot be modified.

This field displays the ledger currency and cannot be modified.

Enter or select a range of open projects to search for projects within that range. Projects cannot be new or closed.

 

  • From analytical dimension (field CODDIMSTR)

Enter or select a range of dimensions to search for dimensions within that range when the calculation basis is dimension. The list suggests analytical dimensions linked to the dimension type completed previously. When an inconsistent selection is made with the revenue recognition rule, you see a "No results found" message.

  • To analytical dimension (field CODDIMEND)

 

  • Revenue recognition method (field RRECMET)

This field displays information from the Revenue recognition code setup and cannot be modified.

  • Status (field STA)

Select a status to filter search results:

  • To be processed: You created the record, but it is not yet calculated.
  • Awaiting validation: You calculate the amounts.
  • Validated: You validated the amounts and they can no longer be adjusted.
  • Simulation posted: You posted the record using a simulation generation type (active or inactive).
  • Posted: The amount is posted to the general ledger.

Close

 

Tab Posting

Fields

The following fields are present on this tab :

  • Generation type (field GENTYP)

Select to filter by a specific generation type.

  • Entry status (field GENSTA)

This field defaults to the Generation type and the related parameter value.

  • Entry date (field REFDAT)

Enter a date to filter on this date.

  • Reversal date (field REVDAT)

Enter a date to filter on this date.

Filter by revenue entry type.

Filter by expense entry type.

Close

 

Tab To process

Presentation

The To process grid includes the same lines in the Revenue recognition function.If the Calculation basis is Dimension for an actual generation, the Analytical dimension column displays the dimension in the To process grid. The project linked to the analytical dimension displays in the Project column.Select the records you want to process and click Calculate to generate the amounts. Messages regarding the financial snapshot or temporary journal entries can also display depending on your settings for the revenue recognition rule.

 

Fields

The following fields are present on this tab :

Grid

  • Select (field SEL)

Select this checkbox to include the project on the line in specific actions: Calculate, Validate, and Post.

  • Status (field STA)

This field displays the current status for the project on the line.

  • Analytical dimension (field CODDIM)

This field displays the analytical dimension if the calculation basis is dimension.

This field displays the project number.

  • Description (field PJTDESAXX)

This field displays the project description.

  • Date (field INIDAT)

This field displays the last validation date for the project on the line.

  • Identifier (field NUM)

This field displays the auto-generated Identifier for the project on the line. It updates with each validation.

  • Revenue comments (field CMT)

Use this field to enter any relevant comments.

Select an account from the company’s chart of accounts. Deferred revenue is posted to this account.

Select an account from the company’s chart of accounts. Actual revenue is posted to this account.

  • Expense comments (field CMTEXP)

Use this field to enter any relevant comments.

Select an account from the company’s chart of accounts. Deferred expense is posted to this account.

Select an account from the company’s chart of accounts. Actual expense is posted to this account.

 

Action icon

Revenue recognition

Select this action to view the revenue recognition rule.

Journal entries

Select this option to view the related journal entries.

Financial snapshot view

 

Close

 

Specific actions

After entering search criteria in the Header, click this action to search for matching projects.

Click this action to calculate the Revenue recognition amounts for selected lines. Only lines with a New status are eligible for calculation. The status changes to Awaiting validation. After validation, you can no longer modify amounts.

Click this action to validate selected lines. After validating, their status changes to Validated and they can be posted. The Identifier field automatically updates.

A log file is only generated if there are errors.

Click this action to post selected lines. The status changes to Posted and the Journal entry number field updates.

Click this action to cancel the validation. This resets the status to Awaiting validation.

Click this action to select all records in the grid.

Click this action to deselect all records in the grid.

Click this action to save any changes made to records in the grid in the adjustment column. If you do not save before exiting the screen, any adjustments you have made will be lost.

Click this action to undo any changes made after the last status.

Error messages

The only error messages are the generic ones.

Tables used

SEEREFERTTO Refer to documentation Implementation