
Event-Based Revenue Recognition - Project-Based Sales - US GAAP (4GS)
In this scenario, you create an enterprise project using the Project with Revenue profile. You then assign this project to sales order items to capture the costs and revenues of sales order processing. The accounting object is the WBS billing element you assign to the sales order items. The actual cost of the project is considered from the sales order item goods issue. You can also assign additional costs to the project, such as time confirmation. Revenue recognition is triggered by each accounting event, enabling real-time margin analysis. If necessary, period-end closing corrects real-time revenue recognition postings. The functionality is provided for dedicated sales order item categories; the supported scenarios are continuously enhanced.
Key Process Steps Covered
- Monitor 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
- Review projects - actuals report
- Review project profitability report
- Inspect revenue recognition postings for projects
Benefits
- Provide out-of-the-box revenue recognition for sales order processing with project account assignment
- Reduce manual effort with real-time automatic revenue recognition postings during the period
- Ensure correctness of posted values after period-end closing, with no separate settlement required
- Provide transparency and clear audit trails for each revenue recognition posting with a link to the reference document
Additional Information
- This scope item is excluded from the default activation
All starter, demo, and trial systems are set up by default with group ledger IFRS. This scope item is therefore excluded. Customers can decide to use this scope items in the Q- and P-systems based on the selected scope bundle.
Where is Event-Based Revenue Recognition - Project-Based Sales - US GAAP(4GS) 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