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Author's profile photo Chen Feng

Event-Based Revenue Recognition Contract Usage Case

Business Requirement

The customer get one year maintenance service contract, the revenue is 1800 USD, according to the requirements of the audit and the provisions of the financial accounting rule, the revenue need split into per months.

And the Customer refused to use partial billing (Billing Plan), because they don’t want handle so much billing documents.

Implementation Requirement

1. Created one billing 1800 USD on date 2020.1.1, synchronous created one deferred income financial document ( Debit: Account Receivable, Credit: Incoming Billing – Deferred Revenue )

2. Create monthly billing 150 USD, 12 financial document (Debit: Incoming Billing – Deferred Revenue, Credit: Main Business Income)

S/4 HANA CLOUD Workaround

Using Event-Based Revenue Recognition Contract, delivered standard scope Item 3MO + 3M3 example:

1. Create one service contract:

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Select settlement period: Yearly (Settlement Period), Billing Date: To First of the Month (Billing Date)

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2. Schedule Billing Document Request:

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3. Billing

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4. Monitor Revenue Recognition (Event-Based): Service Documents

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Customizing

Event-Based Revenue Recognition (EB RR): Sources and Assignment Rules

SSCUI: Maintain Settings for Event-Based Revenue Recognition

In the overview “Sources” select a “Source” and go to the next level “Assign Cost Elements and Accounts”; e.g. “YRM” – Revenue-Manufacturing/Trade.

In the overview “Assign Cost Elements and Accounts” the relevant sources can be maintained. Possible sources to include are single account, range of accounts, condition types and cost element groups. An additional feature is that sources can also be excluded for the process.

Assigned Tags

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