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.

Similar Messages

Revenue Recognition (AR Closed for future month in error)

Need help with revenue recognition. In the month of June in AR July was opened in error, so it was put in to close pending. Since July was closed the last 3 days worth of June invoices did not have any revenue recognition for July. Instead July's revenue was posted in to August since August was showing as a future period, and July was closed. Is there any fix to change the revenue recognition without doing a credit and rebill of 3 days worth of invoicing? If we reopen June, and run revenue recognition again, will that help? Thanks in advance for any help.

Well there are a few ways you can go ahead and fix this, but it depends on lot of factors.
Lets say you have 1 invoice for which the revenue has been recognized in August and not July, now you can query up that invoice in the transaction's workbench and incomplete it. After incompleting all the revenue recognized distributions would be deleted(applicable 11.5.10 onwards) and when you complete the invoice again & run the RR program the revenue would be recognized in July(provided it's in an open status). Please note though that you can incomplete a transaction only if it doesn't have any activity against it!
Now coming to the real world it's possible that the number of transaction's you have could be quite large and doing this manually through the screen might not be feasible. So you could possibly write a small pl/sql script to loop through those invoice's and incomplete them by calling the complete/incomplete group transaction's api. And then again complete them and re-run RR program to complete the fix.
Please note though that you can incomplete a transaction only if it doesn't have any activity against it!
With posted transaction's or transaction's having other activity, it's possible to fix them too but that would be taking things too far and Oracle Support/Development would be best equipped to provide you the fix in that scenario.
HTH,
Jasmeet.

HELP: AR Open Invoices Conversion with Revenue Recognition (Daily Revenue)

Hi,
I need some help on Conversion of AR Open Invoices with Accounting Rules in R12, Here the client wanted to use Daily Revenue Schedule rule,
I am developing Functional Specification Document (CV.040); Need to understand the Assumptions, Approach and Which data needs to be extracted from Legacy System.
Appreciate your reply at the earliest
Thanks
Ravi

Anil,
Thanks for your response, Here are the answers to your questions.
1) The invoices that you want to convert - Do they already have revenue recognition on them?
Ans: Yes they have Revenue Recognition On Them.
2) Are you bringing only Open Invoices? What about Invoices that are closed (paid), but still have unrecognized revenue on them? DO you want to bring them
over? If no, how will be mage the recognition of those invoices?
Ans: We want to bring only Open Invoices. i.e the following scenarios want in Data Extraction
a) Invoice is Fully Paid (REC is Zero) and Unearned is Full Invoice Amount, Revenue is 0
b) Invoice is Partially Paid (REC is Partial) and Unearned is Partial, Revenue is partial
c) Invoice is fully Paid (Rec is Zero) and Unearned is Partial and Revenue is Partial
d) We do not want to bring the invoices with Fully Paid and Fully Recognized, Unearned is Zero
3) What about partially paid invoices? How do you want to bring them in?
Ans: See above scenarios.
4) Do you want to bring in all Invoice details,or just bring in a summary line with the outstanding amount?
we assume only Summary, but if the Invoices with Several Lines and Different Accounting Rules, We may have to bring them too
Appreciate your response; Suggest some possibilties?
Thanks
Ravi

Price Change for Revenue Recognition

Dear experts,
I am using Revenue Recognition of type B with Revenue Recognition before invoicing.
I have an issue/question about the way price changes are treated in the functionality.
The below example is used to describe the issue for your understanding:
1.Pricing master data: $100/EA
2.Price of item in sales order: $100/EA
3.Qty in sales order: 10 EA
4.Delivery & Goods issue: 10 EA
5.Revenue Recognised (VF44) for: $1000
Accounting Entry:
DR Unbilled Accounts Receivable $1000
CR Revenue $1000
6.Change in pricing master data: $120/EA
7.Partial Invoice for: 2 EA @ $120/EA
Accounting Entry:
DR Customer $240
CR Unbilled Accounts Receivable $240
8.Partial Invoice for balance qty: 8 EA @ $120/EA
Accounting Entry:
DR Customer $960
CR Unbilled Accounts Receivable $760
CR Deferred revenue $200
9.Subsequent Revenue Recognition (VF44)
Accounting Entry:
DR Deferred revenue $200
CR Revenue $200
As you can see in the example above, the amount of the price difference is not credited to sales in step 7. From what I have seen so far the additional amount due to price difference gets credited to sales only after the total invoice value for the item exceeds the revenue recognized.
Is there any option to set the system so that the price difference is taken into account for revenue recognition during each invoicing (even
when the invoicing is partial) ?
Thanks in advance for your help.

The price difference will not go to Sales in Step 7. The reason being Revenue Recognition works on the item rather than the amount. Since you have run F-44, the system finds the same in Unbilled Receivables and posts to that account.
For updating the price changes, you have to run VF46 to cancel the original RR entries. In this case, it will just clear of the RR lines if realization has not happened and post a reversal if realization has happened. This txn will also create a new RR line for VF44 which you can process.
Refer Note 820417 Implementation guide for RR. Download the attachments and look into Part2 doc page 13. This explains how to deal with price changes in sales document.
Hope this helps.
Ravi.

Pricing procedure not to bill customer but revenue recognition

I'm looking for guidance on how to setup a pricing procedure conditions. First let me explain the situation. What happens is the customer buys say 2000 software licenses on a sales order. The customer is billed and the customer account is debited and a deferred account is credited. Now the customer activates one of the licenses. The pricing from the sales order is copied to a contract. This contract has a start and end date for the license. Now that license can start to be recognized based on the period of the line item contract dates.. The issue we have is that normally for deferred revenue billing takes places. Problem is customer was already billing on the sales order. Somehow the pricing procure has to credit the deferred account that was posted on the sales order and then credit the revenue recognition account that can be used by transaction VF44.
So on the invoice associated with the sales order Invoice from sales order
Dr Customer $1000
Cr 2370 $1000
The account 2370 is the deferred account. This part is fine.
Now we activate 1 of the licenses.
So the pricing procedure has to do the following with no billing to the custo0mer account Invoice from contract
Dr 2370 $120
Cr 2371 $120
This is the problem part. crediting the deferred account 2370 and then posting into the revenue recognition account 2371
Rev Rec – VF44 for Period1
Dr 2371 $10 Cr 4340 $10 Any ideas would be appreciated

Hi
In SD billing documents customer is always debited or credited based on nature of transaction. For posting in two different G/Ls instead of customer account there is only one possible way which I know. In free goods pricing system can post debit and credit entries to different G/Ls and these G/Ls are controlled through account keys which you assign to condition types in pricing procedure.
Do you have any Idea of free goods pricing and its posting? Explore this and give it a try. I am not sure about this because I didn't test this. You can test and see if it helps.
In this for contract item category you have to use free goods pricing which you set in item category settings in VOV7.
Thank$

Config of billing type G2 for Revenue Recognition

Hello Experts.
I have a situation where I need to configure billing of credits for revenue recognition.
For normal builling we have copied doc type SO to ZBCS and added ZTAD item category (copied from TAD) for the RR.
To do this for credits I copied doctype CR to ZBCR and assigned ZTAD item category to it.
When billing the ZBCR not I get the message "Item category ZBCR ZTAD cannot be invoiced with billing type G2".
How can G2 be configured to allow this?
This is G2's current setup.
Billing Type G 2 C red tM e m o Created by
Number systems
No.range int.assgt. 19 Item no.increment 0
General control
SD document categ. O C re dit m emo Posting Block
Transaction group 7 B il lin g doc um ent s Statistics
Billing category
Document type DG C us tom er cr ed it me mo
Negative posting N o neg at ive p ost in g
Branch/Head office C us tom er =Pa ye r/B ra nch =s old -t o p ar ty
Credit memo w/ValDat N o
Invoice list type
Rebate settlement Rel.for rebate
AcctDetermProc. KOF I0 0 A cco unt De e rm n ato n
Doc. pric. procedure
Acc. det. rec. acc.
Acc. det. cash. set.
Acc. det. pay. cards
Output/partners/texts
Output determ.proc. Z10 00 0 B il lin g Out pu t Application V 3
Item output proc.
Output Type
Header partners FK B iln g D ocu m en t
Item partners FP B il lin g Ite m
TextDetermProcedure 03 Invo c e hea de r
Text determ.proc.itm
Delivery text

Hi,
You may be maually given the PR00 in ZBCR. But in your copy control (VTFA) --> item category ZTAD --> pricing type, you may be maintained B (Carry out new pricing).
If you maintain B, you have to change it to "D ".
When you maintain B, the system will search the Pricing again in Credit memo. All manual prices will be lost.
Thanks
M. Lakshmi Narasimhan

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 based on User Status of assigned Sales Order line item

Dear Community members,
We have requirement to recognize / de-recognize revenue posted to WBS for calculation of RA, based on the 'User status' of the assigned Sales Order line item.
To elaborate requirement further -
1) WBS Element - XXX - 10 ( with operative indicator - Plan/Bill/Account Assign)
2) Sales Order(SO) Line Items assigned to the above WBS -
- SO No - 123 Line Item 10 - Actual Rev - $ 300 - User Status - EXE (Meaning this work is in progress , partial payment received thus actual revenue for RA at WBS is 'Zero'
- SO No - 124 Line Item 20 - Actual Rev - $ 400 - User Status - COMPL(Meaning this work is Complete , all payment received thus actual revenue for RA at WBS is $400
- SO No - 125 Line Item 10 - Actual Rev - $ 800 - User Status - EXE (Meaning this work is in progress , partial payment received thus actual revenue for RA at WBS is 'Zero'
As per WBS reports Actual Revenue posted to WBS XXX-10 is $ 1500 ( $300$400$800) , however since two SO line items ( SO 123 /line item 10 and SO 125 / line Item 10 ) are NOT having User status 'COMPLETE', the actual revenue posted by those line items $ 1100/- ($300 + 800) should not be included as Actual Revenue for RA at WBS level.
Thus Actual Revenue for RA at WBS XXX-10 should be $ 400 /- ( the revenue posted by SO 124/line item 20 which has user status as 'COMPLETE')
How do above can be achieved?? Is there any standard solution for this?? Is any SAP Note available for this (I too am looking for one but not found any ) ?? do we need any enhancement , Customer exit etc
Thanks in advance
with regards

Hi,
Thanks. You are right that the 'Completed Contract Method' would defer revenue recognition. However, the status checked would be of the RA object (WBS Element in this case, as RA key is on WBS and RA is being calculated on the WBS).
However, our requirement is to check the user status of the Sales Order Line items assigned to the WBS element and filter the revenues posted based on the active user status of individual Sales Order Line item.
Please give you inputs.
Thanks in advance
With regards

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

How Revenue Recognition value calculate in VF45 for an item

Hello Experts,
I want to know how system calculates Revenue Recognition for any item in VF45. I know the configuration part of Revenue Recognition but want to know the calculation part, how calculation going to find out the vale of the Revenue recognition.
Item net price is 3139255.45 and system calculate Revenue recognition for this item is 3139020.94.
I want to know how calculation going for Revenue recognition.
Can any body help me out ? any link /document related to Revenue Recognition Calculation (not configuration) please share with me.
Thanks,

Hello Prasanth,
For example :- Maintaining an annual Price ZPRC - 1200 and Billing plan is Annual
So, while recognising SAP takes 1200 / 365(Number of days) = 3.287 per day
For jan - 31 days - 31*3.287 =101.91
For feb - 28 days - 28*3.287 = 92.05
Thank you for your time.

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

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

Service based revenue recognition (u0091Bu0092) contract with call off

I am trying to understand Revenue Recognition. I have come across the above term." Contract with call off"
Can anyone tell me what exactly this means.

Dear sap
The contract consists of items defining the individual materials, material groups, or services with prices and in many cases quantities.
An item is assigned to an item category, which defines the type of procurement (e.g. item category K for consignment, or L for subcontracting).
An item of the procurement type "external service" contains a set of service specifications. Such specifications may be hierarchically structured. The summary view of such a hierarchical structure is termed an "outline", and the individual levels of the hierarchy are referred to as "outline levels". Quantities are specified in service lines. Services can be released (<i>ordered, or called off against the contract</i>) at item level or at the level of the service line.
Thanks
G. Lakshmipathi

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

Revenue Recognition in Russia

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