Revenue recognition
| DMF |
0707** ACCOUNTING SETUP SETUP 070711 ACCOUNTING SETUP REVENUE RECOGNITION |
Before launching the revenue recognition (Accounting > Periodic works > Revenue recognition) it is necessary to setup it beforehand. The revenue recognition setup can be done according to various methods:
- Completion (see Setting up the completion method);
- Theoretical progress (see Setting up the theoretical progress method);
- Actual progress (see Setting up the actual progress method);
- Prorata (see Setting up the prorata method.
This setup is available from Tools > Setup > General setup > Accounting > Revenue recognition.
Setting up common fields
At the top of the screen, specify the following common fields:
| Field | Description |
|---|---|
| Code | Specify a code. |
| Valid until |
Enter a validity end date. When the end date has passed, the method can no longer be used. This field is not required. |
| Label | Specify a label. |
Setting up the completion method
To setup the revenue recognition with the completion method:
| 1 | Select the Level to apply: |
- Project: Allows you to apply a grouping per project.
- Phase: Allows you to apply a grouping per phase.
- Sub-phase: Allows you to apply a grouping per sub-phase.
| 2 | Under the Level of details section, select the desired option: |
| Field | Description |
|---|---|
| Accounting account | Select this option to have a grouping per accounting account. |
| Account - Product sold | Select this option to have a grouping per accounting account and sold product. |
| Account - Product sold - Customer | Select this option to have a grouping per accounting account, sold product and customer. |
| 3 | Under the Calculation of revenue basis section, select one of the following options: |
| Field | Description |
|---|---|
| Revenue calculated based on deliveries only |
When this box is checked, the revenue recognition is calculated by only taking into account deliveries. When this box is left unchecked, the revenue is calculated by taking into account all validated objects. |
| Budget calculated with updated sales forecast | When this option is selected, validated orders are taken into account in the budget calculation. |
| Budget calculated with the signed quotations | When this option is selected, signed quotations are taken into account in the budget calculation. |
Setting up the theoretical progress method
The revenue is calculated by applying a percentage of progress on the ordered amount. The ordered amount is calculating by adding:
- non delivered orders,
- non-billed deliveries;
- sales invoices.
The progress percentage is calculated by comparing the timesheets and the number of sold days (matching the quantities in the order lines).
To setup the revenue recognition with the theoretical progress method:
| 1 | Select the Level of details to apply: |
- Project: Allows you to apply a grouping per project.
- Phase: Allows you to apply a grouping per phase.
- Sub-phase: Allows you to apply a grouping per sub-phase.
| 2 | Under the Level of details section, select the desired option: |
| Field | Description |
|---|---|
| Accounting account | Select this option to have a grouping per accounting account. |
| Account - Product sold | Select this option to have a grouping per accounting account and sold product. |
| Account - Product sold - Customer | Select this option to have a grouping per accounting account, sold product and customer. |
| 3 | Under the Time status code section, check the status codes to take into account for timesheets: |
- Gross;
- Checked;
- Invoices;
- Free;
- Not invoiced;
- Denied;
- Validated;
- Dissociated.
Reference
Time validation status codes are set up from the Desktop Application, in Tools > Setup > General Setup > Resources and Labor > Time validation status code.
| 4 | Under the Calculation of revenue basis section, select one of the following options: |
| Field | Description |
|---|---|
| Budget calculated with updated sales forecast | When this option is selected, validated orders are taken into account in the budget calculation. |
| Budget calculated with the signed quotations | When this option is selected, signed quotations are taken into account in the budget calculation. |
| Remaining tasks calculated from |
of valuated schedules: Remaining tasks is calculated based on valuated schedules created after the closing date. of remaining project tasks: Remaining task is calculated from the project tasks and the valuation of the employee linked to the task. |
Setting up the actual progress method
The revenue is calculated by applying a percentage of progress on the ordered amount.
To setup the revenue recognition with the actual progress method:
| 1 | Select the Level to apply: |
- Project: Allows you to apply a grouping per project.
- Phase: Allows you to apply a grouping per phase.
- Sub-phase: Allows you to apply a grouping per sub-phase.
| 2 | Under the Level of details section, select the desired option: |
| Field | Description |
|---|---|
| Accounting account | Select this option to have a grouping per accounting account. |
| Account - Product sold | Select this option to have a grouping per accounting account and sold product. |
| Account - Product sold - Customer |
|
| Calculation of expenses with valuated time and purchases |
When this box is checked, purchases are taken into account in the budget calculation. Note In this case, only the purchased items with the Income progression-based cost recognition box checked in their record sheet (Management > Purchases > Purchased items > General tab > Article section) are taken into account. |
| 3 | Under the Time status code section, check the status codes to take into account for timesheets: |
- Gross;
- Checked;
- Invoices;
- Free;
- Not invoiced;
- Denied;
- Validated;
- Dissociated.
Reference
Time validation status codes are set up from the Desktop Application, in Tools > Setup > General Setup > Resources and Labor > Time validation status code.
| 4 | Under the Calculation of revenue basis section, select one of the following options: |
| Field | Description |
|---|---|
| Budget calculated with updated sales forecast |
When this option is selected, validated orders are taken into account in the budget calculation. |
| Budget calculated with the signed quotations | When this option is selected, signed quotations are taken into account in the budget calculation. |
| Actual calculated with (available when the Calculation of expenses with valuated time and purchases box is checked) |
Actual: expenses: When this option is selected, actual expenses are calculated based on the management objects of the Purchases chain. Logging of expense recognition: When this option is selected, the actual expenses are calculated from the logging of expense recognition. |
| Remaining tasks calculated from (available when the Calculation of expenses with valuated time and purchases box is checked) |
of valuated schedules: Remaining tasks is calculated based on valuated schedules created after the closing date. of remaining project tasks: Remaining task is calculated from the project tasks and the valuation of the employee linked to the task. of logging of expense recognition: Remaining tasks is directly retrieved from the Expense to recognize column from the history of allocation of expenses. |
Setting up the prorata method
It is a revenue recognition method based on the period of management objects lines (Period from and to). To setup the revenue recognition with the actual progress method:
| 1 | Select the Level to apply: |
- Project: Allows you to apply a grouping per project.
- Phase: Allows you to apply a grouping per phase.
- Sub-phase: Allows you to apply a grouping per sub-phase.
| 2 | Under the Level of detail section, select the relevant option: |
| Field | Description |
|---|---|
| Accounting account | Select this option to have a grouping per accounting account. |
| Account - Product sold | Select this option to have a grouping per accounting account and sold product. |
| Account - Product sold - Customer | Select this option to have a grouping per accounting account, sold product and customer. |
| 3 | Under the Calculation of revenue basis section, select one of the following options: |
| Revenue calculated based on deliveries only |
When this box is checked, the revenue recognition is calculated by only taking into account deliveries. When this box is left unchecked, the revenue is calculated by taking into account all validated objects. |
| Budget calculated with updated sales forecast |
Validated orders are taken into account to calculate the budget. |
| Budget calculated with the signed quotations | Validated quotations and quotations non signed and turned into orders are taken into account in the budget calculation. |
