Regarding Revenue Recognition

Dear Friends,
I configured Revenue Recognition to my service client.In general process after saving the billing document we can see The bellow entries for accounting document.
Customer a/c Dt
Sales revenue a/c Cr
All taxes are Cr
But i want to know the accounting entries for the billing document which is created in Revenue Recognition.
Thank you,
Regards,
Ravi

which is created in Revenue Recognition
In order to see any details related to Revenue Recognition, have you executed VF44 ??
G. Lakshmipathi

Similar Messages

Revenue recognition

Hi Gurus,
I require help regarding revenue recognition. I have a scenario where customer pays part amount as advance payment, I have following doubts
1) If I configure revenue recognition at item category, what will be the effect in case of regular payment (non advance)
2) configuration steps for revenue recognition.
regards,
HB

I have a scenario where customer pays part amount as advance payment, I have following doubts
Just search the forum with the text "Down Payment" so that you will get lot of documentation on this topic. Take the inputs and try on your own.
configuration steps for revenue recognition
First and foremost part is you / Client have to get concurrence from SAP to configure.
G. Lakshmipathi

Revenue Recognition in Russia

Hi,
we are rolling out our global SAP solution for Russia and I would like some valuable inputs from SAP Gurus to my query.
My query is regarding revenue recognition in Russia. According to local GAAP, unless a signed copy of the TORG-12 (Act of acceptance of the transfer of goods) is received from the customer, it cannot be considered as revenue for accounting purposes in Russia, whereas for US GAAP purposes revenue can be recognized once the goods have been delivered.
US GAAP is the leading ledger and Russian GAAP is the non leading ledger but it is not possible to release billing to accounting for the leading ledger only.
Another point to note is that Russian accounting is based on actuals and no accruals can be posted for revenues.
Pls. can someone provide me some insight as to how these two requirements were handled together in their projects within SAP.
We are on SAP ECC version 6 ehp4.
Thanks in advance for all your help.
Regards,
Nitin

Dear Deepu,
The Concept of "Revenue Recognition" in Item Category is -
The material, with specified Item Category, is defined for income-accrual or not.
Now, Income-accrual means, say, in a month, you have "n" no. of orders to deliver, but might possible that Invoice and Payment, may get done or may not be.
So, to realise such income for a particular period, we run revenue-recognition (VF44). In VKOA, we maintain "Provisional Account" for such income.
Once invoiced, Accrued income G/L gets debited and Customer G/L gets credited.
[Revenue Recognition|http://help.sap.com/erp2005_ehp_03/helpdata/EN/4d/fcd139f6e4cf2ce10000000a114084/frameset.htm]
As you asked for maintaining - Type "A" in Item Cat., go through
[Time related Rev. reco.|http://help.sap.com/erp2005_ehp_03/helpdata/EN/59/aff23cd85c11d199d60000e8a5bd28/frameset.htm]
Another Type is "B"
[Service related Rev. reco.|http://help.sap.com/erp2005_ehp_03/helpdata/EN/59/aff23fd85c11d199d60000e8a5bd28/frameset.htm]
Best Regards,
Amit
Note: There are few of my posts in threads
Re: Revenue recognition
Re: Revenue recognition design
this will provide some in-sights for rev. recog.

Cost of Goods & Revenue Recognition

Dear All,
I have a typical requirement related with the cost of goods sold (COGS) G/L account & the revenue recognition.
Under SAP best practice, the COGS account is updated together with the Inventory account when post goods issue (PGI) is done.
there are 2 scenarios here -
1. Normal Sales - delivery related invoicing. Here the invoice is created immediately after the delivery. So here the revenue & cost recognition matches.
2. Project sales - PS not being used. Just created milestones using milestone billing. Here the invoice is order related with billing plan. So the milestones are
a. 50% after order confirmation.
b. 40% after delivery.
c. 10% after installation & commissioning.
Here the revenue will be generated at three stages & the COGS will be updated after delivery (PGI).
Is there any way we can update the COGS at the time of invoice in standard SAP.....?
With best regards,
Niyaz.

Hi friend,
Pls use T-code OMJJ and OBYC to setting as stop update acct in PGI! I only know the location to impact about it! With update acct in Invoice, I need to verify again for! I will update when I cover it. Hope this help
Best regards,

Not able to delete a delivery after revenue recognition is reversed

Hello Gurus,
We have a situation for certain Sales Order types after creation of Sales Order -> Delivery and PGI, we do revenue recognition. But there was some mistake and delivery needed to be deleted and recreated if needed. So after doing revenue recognition reversal we are reversing the PGI. After this when we try to delete the Delivery ( which would have got deleted if there was no revenue recognition process ) we get the below error.
Is it a problem with the way Revenue recognition is configured or does the standard behave like this. If the Invoice is also present in the above I am able to cancel the Invoice. If you think its a problem with the way Revenue reccognition is configured please advise.
Item 000010 cannot be deleted (revenue recognition status)
Message no. VL896
Diagnosis
The delivery or delivery item cannot be deleted.
System response
The document cannot be deleted since the delivery contains items that
reference sales document items that are relevant for revenue
recognition. When the goods issue was posted, the system created revenue
lines that had already been recognized. This means that there are
subsequent documents in revenue recognition for this delivery.
Procedure
If you no longer require the delivery or delivery item for deletion, set
the delivery quantities to zero and repost the goods issue. Make sure
that the quantity zero is allowed in Customizing for the delivery item
category. When the goods issue is posted, the overall processing status
is set to C and the delivery can be archived. Message determination
should be configured not to send any messages in this case. To make sure
that the system makes revenue corrections if there are differences
vbetween billed and recognized values, set a billing-relevant rejection
reason in the sales document item if more than one partial delivery is
allowed.
If you still want to use the delivery, adjust the delivery quantities
accordingly. Alternatively, deliver the referencing sales document item
again. Note that the sales document item cannot be delivered again if
only a partial delivery is allowed.
What are the changes I can do to Delete the Delivery?
If I cannot Delete the Delivery, Should I make the Delivery as 0 qty and create a new delivery with changed qty and do further process. Or should I reject the Sales Order and create a new sales order with exact qty and do further process.
Please advise.
Regards,
SNK.
Delivery has one line item. For the above case scenario, invoice is there for some deliveries and for some deliveries there is no invoice. Eg: SO -> DN -> PGI -> Rev Recog -> Iv or SO -> DN -> PGI -> Rev Recog. Requirement was SO was wrongly created as the qty was wrong or in some cases SO needs to be rejected. I am able to cancel Invoice. Rev recog is reversed. PGI is cancelled by VL09. Not able to delete Delivery and I get the above error. Ideally I thought since Rev recog is reversed, Delivery should have been deleted but not happening and above error comes.
SO - Sales Order DN - Delivery IV - Invoice
Edited by: sapconsultnt on Dec 16, 2009 5:06 AM

Hello,
Please review the Note 1224871 which introduced this functionality.
Regards,
Raghavendra YN

Revenue recognition at the time of Delivery - COPA

Dear Gurus,
Our sales cycles are bit different than the standard sales process.
In one of the sales cycle the business does the Billing first and delivery later and the revenue recognition should happen at the time of delivery not billing.
How do I achieve the same in COPA data flow and is this a reason why I should activate account based copa?
Regards
Roy
Edited by: roy001 on Mar 27, 2011 8:03 PM

Hi
Thank you for you comments.
Our business scenario is car sale- The car dealer looks into portal(called dealer portal) and checks the availability of a car.
Once the dealer makes the car selection, he then places an purchase order to the car manufacturer.
Based on the order the car manufacturer asks for the full payment from the dealer. After receiving payments, the car manufacturer delivers the car.
Therefore the invoice is raised before delivery.
The problem that we have in the above scenario is the COPA value flow. How do I flow the values into copa?
Any input?
Many thanks.
Regards
Roy

Changing Profit Centre in Revenue Recognition document

We have recently changed the profit centers in material master. The already existing invoices are carrying those old profit centers. Now if we create revenue recognition documents for these existing invoices then the old profit centers gets referenced.
Is there any way that the updated profit centers from the master are copied into the revenue recognition documents. I believe in the invoice documents the profit canters cannot be changed.

hi
The system proposes the profit center in the cost center belonging to the responsible work center. You can overwrite this, however.
If you change the responsible work center in the order, the system does not automatically overwrite the profit center on the additional data header screen. If required, change this manually.
You can change the profit center in the order, provided that no actual data exists for the order yet
regards
thyagarajan

Service-related revenue recognition

Hi Experts,
When post VF44 for a contract with Service-related revenue recognition (revenue recognition category B) get the message below. No RR FI document posted too.
<<Document for SD reference number u2018delivery orderu2019 does not exist
Message no. JHE019
DiagnosisDocument for SD reference number &1 does not exist. If accounting documents for revenue recognition have been created at collective processing level, you cannot navigate in the original document.>>
Any advise.
Cheers.

hi,
please check in scribd these is a link related to RR.
or
please check in forums on the same.
regards,
balaia

Item Category--Revenue Recognition

Dear All,
system is not allowing me to assign revenue recognition field in VOV7 as it is grey field.
As well when I tried through IMG/S&D/Basic Function/Account assignement/Revenue Recognition Item Category-Change mode system is showing grey field for revenue recognition here also.
Please guide on how can I assign here.
Regards,
Sainath

Hi,
In order for this to work, the revenue recognition functionality has to be activated in the system (because of important financial implications and risks, it isn't activated by default).
You need to raise a message to SAP for this.
Please check OSS note 820417.
Best of luck,
Cosmin

Data Migration of Contracts with periodic billing and revenue recognition

Hello Experts,
I am trying to develop a legacy data migration plan for Contracts with periodic billing plan and revenue recognition.
Example of the scenario is given below:
Customer signed a contract for one year starting 01/01/2009.
Customer is billed quartely, billed in advance.
SAP going live on 04/01/2009
Customer is billed for 3 months and also for initial set up fees.
Revenue recognition is done monthly.
We have to migrate this contract to SAP.
Billing document posting may be necessay as it affects revenue recognition which spans across the total contract period.
Any ideas how to do this?
Thanks A Lot
Anil
Edited by: Anil Jose on Sep 17, 2008 9:38 PM

Hi Anil
How did you manage this? We also had the same problem in one of our contracts and what we did was that we copied the contracts from the legacy with the full value. That is suppose SAP went live on 1st April, 2009 and the contract was created on 1st January 2009 for a value of suppose 100 USD, with the first billing being done on 1st Jan for 33.33 USD for 4 months. We first created the contract with a validity from 1st Jan 2009 in the new system. We billed it with a billing type that we created that did not actually create new accounting entries as the accounting entries had already been created in the legacy system. In the new system then we recognised the revenue till the go live, so that the actual value remaining of the contract reduced. Then we started the billing plan of the contract from 1st of April 2009 for the remaining amount. So next invoice was created on 1st april for 33.33 USD. Can you share your solution.
Regards
Indranill

Revenue recognition in Item category

Dear All
Can you advise what exactly is revenue recognition in item category?.
I need to enter A in the field, but the field is greyed.
Thanks
Deepu Pillai

Dear Deepu,
The Concept of "Revenue Recognition" in Item Category is -
The material, with specified Item Category, is defined for income-accrual or not.
Now, Income-accrual means, say, in a month, you have "n" no. of orders to deliver, but might possible that Invoice and Payment, may get done or may not be.
So, to realise such income for a particular period, we run revenue-recognition (VF44). In VKOA, we maintain "Provisional Account" for such income.
Once invoiced, Accrued income G/L gets debited and Customer G/L gets credited.
[Revenue Recognition|http://help.sap.com/erp2005_ehp_03/helpdata/EN/4d/fcd139f6e4cf2ce10000000a114084/frameset.htm]
As you asked for maintaining - Type "A" in Item Cat., go through
[Time related Rev. reco.|http://help.sap.com/erp2005_ehp_03/helpdata/EN/59/aff23cd85c11d199d60000e8a5bd28/frameset.htm]
Another Type is "B"
[Service related Rev. reco.|http://help.sap.com/erp2005_ehp_03/helpdata/EN/59/aff23fd85c11d199d60000e8a5bd28/frameset.htm]
Best Regards,
Amit
Note: There are few of my posts in threads
Re: Revenue recognition
Re: Revenue recognition design
this will provide some in-sights for rev. recog.

SAP Revenue recognition Credit Memo Accounting document

Hi,
One of our client uses SAP Revenue recognition to post revenue. They have implemented the Service related revenue recognition (revenue recognition category B) and also process credit/debit memo with reference to preceding docuemnt
"F". Each month a debit memo is issued ot the customer for the services performed. Eventually we create credit memos when the customer disputes a particular debit memo invoice. Debit memo and credit memo documents
are created with DP96.
The issue they have currently is with the credit memo account document postings. Client credit memo accounting documents are making postings to unbilled revenue accounts. The postings remain as debit postings in unbilled revenue accounts even after revenue is recognized for an order. According to them accounting rules do not fulfil with the credit memo postings to the unbilled revenue account. Hence we need your expert advice/opinoins.
Please reply as soon as possible because its very high priority issue.
Thanks & Regards
K.R.

Hi,
Please check the reason for value not flowing to the header data of the billing document.Once you get the value of the document tin the header , there will be no issue in creating an accounting document.
Check the item category of the credit memo.
Regards,
Phani Prasad

Revenu recognition options grayed up

Hi
We are facing an issue with the SPRO Revenu recognition options which are grayed up, which does not allow to select any values. We have allowed all the authorization etc. but no luck. Follows the procedure to see those option :
TC- SPRO --> SAP Reference IMG --> Sales and Distribution --> Basic Functions -->
Account Assignment/Costing --> Revenue Recognition -->
Click on Set Revenu Recognition For item Categories --> It shows the ItCa and Description column --> I click on change option and then double click any of them (eg. AES in ItCa column --> Click on change and when try to enter the value for any of the Business Data ie. 1) Rev. recognition, 2)Acc. period start, and 3) Revenu Dist (These options are grayed up and does not allow to select any the entry in fact the right check mark is also grayed up.
Any solution would be highly appreciated, as its very urgent in our production system.
Thanks and Regards
Abdul Majid

Hi Majid,
What's your client status ? Is it set to modifiable.
Cheers
Deepanshu

Revenue recognition job hangs and needs reboot of servers

We are on SAP BPC v7.0 SP6.1, using Microsoft Office 2007 and Internet Explorer 7. We have two environments - Production and QA. Production so far is running fine; QA is on a smaller environment.
I am an application user and load final production files into QA each month. For the past two months when trying to run the revenue recognition job for April 2010 and again for May 2010, the job just hangs where it would normally take about two minutes to complete. Both times it was the only job running at the time, as no one was using the QA environment. I had to terminate the job (which might leave the job running in the background) and have our Server team reboot our two servers (Application and SQL Server Analysis Services). Then the revenue recognition job completes.
Depending if I terminate and resubmit the revenue recognition job, I might get the following detail log message:
Execute formulasError
Failed to commit transaction
1 errors writing data
Send through SendGovenor failed
Last week, our DBA set the QA databases to Simple instead of Full recovery and shrank the transaction log files. I ran a test revenue recognition for July 2010 and the DBA tried to monitor the environment, but he could not see any job committing or any activity on the database. I ended up rebooting our servers to complete the test.
Has anyone experience similar problems and was able to resolve it. Any ideas would be appreciated. Thanks.
Bucky

Hi Sorin Radulescu,
I load the initial billing file using the Import logic script and select the data file and transformation file. I click on the Merge data values option; click No to run default logic; and click No, do not check work status settings. Once the import completes, I run the revenue recognition logic for the accounts and periods I am working with.
I compared our Production transformation file, default logic script (which I am not running), and revenue recognition logic script to QA and they both match. My problem is when I run the exact same revenue recognition job in QA, the job just sits in running status but should finish in a couple of minutes. I would let it run for a couple of hours in QA, then terminate the job and have our two servers rebooted, then the same revenue recognition job runs to completion within a couple of minutes.
I am just wondering if there could be some other setting that does not let the job submission kick off the actual update to the database. To make sure the database was not hosed from the terminated revenue recognition job, I ran a different but smaller job and it completed. Then I would ask for the reboot and resubmit the revenue recognition job and it completes.
I will let our DBA know about monitoring the dllhost.exe for amount of memory used. But the last time he tried to check for any activity on the database he could not see anything, but I do not know if he was checking dllhost.exe or some other files.
Thanks for your response and suggestions. Since this is our QA environment (which I try to keep current with Production), I am trying to see if I can identify the cause and fix it, in case it carryover to our Production environment.
Regards,
Bucky

Revenue recognition field greyed out

Hi Gurus,
I am unable to set revenue recognition for item categories as the fields are greyed out. Please help me with relevant settings and configuration.
Thanks in advance
Raj

Hi,
In IMG under
Sales and Distribution -> Basic Functions -> Account Assignment/Costing -> Revenue Recognition -> Set Revenue Recognition For Item Categories
and
Sales and Distribution -> Sales -> Sales Document Item -> Define Item Categories
Regards,
Srilatha.

Regarding Revenue Recognition

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