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The SAP Revenue Accounting and Reporting (RAR) solution is growing by leaps and bounds!  Customers are asking me all the time to describe the functionality in SAP RAR.  So, to help answer this question, below lists a summary of the new features and functionality introduced in SAP RAR versions 1.0 – 1.2 split into four categories: 1) Revenue Accounting and Reporting (RAR) core features, 2) contract modification, 3) connection to operational systems, and 4) migration to SAP Revenue Accounting and Reporting (RAR) including transition.  SAP Revenue Accounting and Reporting (RAR) 1.2 & S/4HANA Finance provides the most modern revenue recognition solution available while SAP Revenue Accounting and Reporting (RAR) & SAP ERP Financials provides state of the art revenue recognition capabilities.

There have been three releases of SAP Revenue Accounting and Reporting (RAR) to date:

Version 1.0 went General Availability in March 2015: Release Notes

Version 1.1 went General Availability in February 2016: Release Notes

Version 1.2 was “Released to Customer” in May 2016 and part of the Early Adoption Program and Release Notes

Revenue Accounting and Reporting (RAR) Core Features

Version 1.0

Support for the 5-step process through business rules and event driven model

Contracts can be combined manually or automatically via rules if contracts have open items

Automatic or manual creation of performance obligations (POBs)

Automatic setting of stand-alone selling prices (SSPs)

Automatic allocations to the performance obligations

Recognition of revenue via events (time based or event based)

Changes to fulfillment type prior to fulfillment

Multiple element arrangements supported

Contract liability / asset calculated at contract level. Distribution of contract liability / deferred revenue by reporting

Parallel reporting

Multiple accounting principles supported

Revenue accounting decoupled from operational systems

Version 1.1

Recognition of revenue – consumption based revenues and estimations

Additional flexibility of contract selection for posting, simulation and error handling

Faster period close – integrated in SAP financial closing cockpit, ability to shift erroneous contracts to the next period for catch up posting


Support for S/4HANA Finance

Version 1.2

            Recognition of revenue – percentage of completion from results analysis

Contract combination of already fulfilled or invoiced contracts, cumulative catch-up can be triggered if required.  Reporting on historical information still available

Enhancements to automatic rules and manual determination of contract combination

Changes allowed to fulfillment type after posting

Finalization of performance obligation (without the need to adapt the operational document)

Enhanced work-list functions – retaining settings for distribution, conflict handling

Distribution of contract liability and asset drill down to performance obligations with customer specific logic

Cost recognition

Capitalized cost of contract acquisition

Explanation for recognized revenue with associated change history to easily analyze and verify the revenue per period

Selection of different levels of aggregation of revenue postings, parallel postings and additional and customized checks

Contract Modification

Version 1.0

Retrospective change, modification triggers re-allocation and cumulative catch up

Version 1.1

Prospective change, allocation of the remaining revenue to the remaining performance obligations

Version 1.1

Enhanced Capabilities for Contract Combinations

Connection to Operational Systems

Version 1.0

SAP sales order, delivery and invoice integration out of the box

Integration to systems for other SAP document types and non-SAP systems through adapter framework

Account determination – reference accounts required from operational applications

Reconciliation of integrated SAP components

Version 1.1

Account Determination can be derived from any attribute in order item RAIs’ with the Business Rules Framework (BRF) +

Predecessor Documents – an order item can contain a reference to a predecessor document, ie return

Reconciliation of operational applications and revenue accounting

BAdi implementation of generic reconciliation framework with non-SAP operational sender systems

Simplified processing of periodic billing plans

ERP SAP hybris billing, invoicing component (formerly SAP Billing Revenue Innovation Management (BRIM) sends the required revenue accounting data for order items, fulfillments and invoices

Reconciliation of revenue accounting items with contracts at bill of material Item level

Version 1.2

Integration with CRM Service Contract (including Package Quotation, service contracts, service order and service confirmation) as stand alone or in combination with ERP SD Billing      

Integration with cost object controlling – transfer for percentage of completion from results analysis to revenue accounting, revenue accounting transfers revenue allocation to results analysis.

Enhanced CO account assignments – additional CO account assignments possible in revenue accounting and through to reporting

Performance obligation creation direct from billing items

Migration to SAP Revenue Accounting and Reporting including Transition

Version 1.0

Migration support – transfer all data per company code, existing sales order documents (excluding orders with SD revenue recognition)

Version 1.1

Definition of packages of contracts for more granular migration

Define transfer date and status per migration package and company code

Package with latest transfer date can still be in status migration while older packages are already productive

Operational items have to be assigned distinctly to a package

Transfer of data from SAP sales and distribution revenue recognition functionality

Operational load from SAP sales and distribution (SD) order items transfers recognized revenue from SD revenue recognition

Version 1.2

Transition Support

General support for full and modified transition to IFRS 15

Create new accounting principle as copy of existing principle or new load of data

Calculate cumulative catch up

Comparison reporting

Switch off an accounting principle after comparison period

Operational load and transition for cost object controlling

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  1. Oleg Kanonchik

    Hi, currently any version of SAP RAR needs at least an SAP ERP 6.0, Enhancement Package 5. Is there any plans to downgrade it for using with at least with EHP 4 or even with pure 6.0?


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