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Topic

    Amit Mishra
    Automatic Revenue recognition over a period of timeAnswered
    Topic posted July 22, 2019 by Amit MishraRed Ribbon: 250+ Points, tagged Other, Project Billing & Revenue, Project Contracts, Project Management 
    48 Views, 4 Comments
    Title:
    Automatic Revenue recognition over a period of time
    Summary:
    Is there a feature available in Project billing where the revenue amount on an billing event be automatically recognized based on the provided number of periods?
    Content:

    Hi All,

    Has anyone come across a situation in contract project billing where we need to recognize revenue on a contract over a period of time e.g. create a billing event of $12K today, however, the revenue has to be recognized in next 12 months and not immediately? Our scenario is kinda simple where we bill the customer in a lump sum at the beginning of the year but revenue has to be recognized per the revenue recognition schedule. I understand that one way could be to pre-create as many billing events (either manually or FBDI upload) with the respective revenue recognition amount and future completion date to recognize the revenue every period, however, I was more interested in knowing about any other automated way instead of setting up the events beforehand.

    Also, I know there is revenue recognition schedule functionality by accounting period in Receivable module, will that work for contract/project revenue?

    Any help would be appreciated.

    Thanks/Amit

     

    Version:
    19B

    Best Comment

    Perry Unrau

    ER 28461593 covers the need for this functionality.  We have it on our roadmap to deliver this capability using the new process configurator, but we aren't currently targeting to deliver it within the next 12 months.  One alternate approach would be to make the revenue method classification percent complete.  Once a month a user could update the percent complete value on the associated project or contract line, say to 8.33% for month 1 of a 12-month contract with straight-line revenue to be recognized monthly, and then when Generate Revenue is run, an automatic billing event is created for the month's worth of revenue.  Using the revenue recognition schedule in Receivables is NOT recommended because it will not feed back to Projects and therefore all the project performance reporting in Projects will be missing that revenue.

    Perry

     

    Comment

     

    • Perry Unrau

      ER 28461593 covers the need for this functionality.  We have it on our roadmap to deliver this capability using the new process configurator, but we aren't currently targeting to deliver it within the next 12 months.  One alternate approach would be to make the revenue method classification percent complete.  Once a month a user could update the percent complete value on the associated project or contract line, say to 8.33% for month 1 of a 12-month contract with straight-line revenue to be recognized monthly, and then when Generate Revenue is run, an automatic billing event is created for the month's worth of revenue.  Using the revenue recognition schedule in Receivables is NOT recommended because it will not feed back to Projects and therefore all the project performance reporting in Projects will be missing that revenue.

      Perry