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Event-Based Revenue Recognition – Project-Based Services – US GAAP (33O)

Event-Based Revenue Recognition – Project-Based Services – US GAAP (33O)

Event-based Revenue Recognition calculates and posts real-time revenue and cost adjustment for professional services for fixed price, time and material, and periodic service projects, using US GAAP Ledger functionality. Revenue recognition is either cost-based or time-based depending on the project type.

Processes that do not write a prima nota do not result in any real-time revenue recognition postings (for example, changes of plan data do not directly result in revenue recognition postings). If necessary, period-end closing postings (periodic revenue recognition) correct the event-based postings. This scope item covers best guess reporting, as figures are only correct after period-end closing.

Event-based Revenue Recognition also supports bundling, revenue calculation, and posting in the context of ASC 606. For more information, see SAP Note 2524569.

Key Process Steps Covered

  • Monitor event-based revenue recognition for projects
  • Manage real-time revenue recognition issues
  • Run revenue recognition for projects in period-end closing
  • Manage revenue recognition issues for projects
  • Report project actuals
  • Report project WIP details (relevant only for time & material projects)
  • Allocate the revenue (relevant for bundled projects only)
  • Inspect revenue recognition postings

Benefits

  • Significant change in the underlying method of revenue recognition (available in SAP S/4HANA)
  • Adjustment for imminent loss, anticipated sales deductions, and unrealized costs
  • Run a simulation. In this app, you can view important project KPIs via semantic tags
  • After period-end closing, the posted values are fully correct, and no separate settlement is required

Additional Information

  • This scope item is excluded from the default activation

All starter, demo, and trial systems are by default setup with group ledger IFRS. This scope item is therefore excluded.  Customers can decide to use this scope items in the Q- and P-system based on the selected scope bundle.


Where is Event-Based Revenue Recognition – Project-Based Services – US GAAP(33O) being used?

This Scope item is used in the following way:

  • As a support function of Accounting and Financial Close within Finance Scope Item Group
  • As a core function of General within Professional Services Scope Item Group

Process flow of Event-Based Revenue Recognition – Project-Based Services – US GAAP (33O)

Find below the process flow of the scope item Event-Based Revenue Recognition – Project-Based Services – US GAAP as it is defined for release s4hc-2108.

process-flow


Ref: Professional Services of SAP S4HC-2108


Best Practices related to S/4HANA

*1) Yearly Updates are released per September of each year
*2) The Quarterly updates are released per Februari, May, August and November
Details of future releases can be found in the SAP Roadmap section of each product. Go to SAP Roadmap Product Finder.


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