
IMG Path - Financial Accounting > Revenue Accounting > Revenue Accounting Contracts > Define Performance Obligation Types
Items | Qty | SO Rate | SSP | Contractual Price | Total SSP | Allocated Amount | Allocation Effect |
EWMS4-50 | 1 | 20,000 | 15,000 | 20,000 | 15,000 | 20,735.29 | 735.29 |
TG12 | 5 | 600 | 340 | 3,000 | 1,700 | 2,350.00 | (650.00) |
SM0001 | 1 | 500 | 300 | 500 | 300 | 414.71 | (85.29) |
23,500 | 17,000 | 23,500 | 0 |
For many entities, Step 1 will be straight forward; the key point is to determine when a contract exists. Using Tcode FARR_RAI_MON or Fiori App Manage Revenue Accounting Items, all sales order items will be showcase initially as processable RAI’s. Then all such processable RAI’s are transferred using default sender integration component as SD with RAI class as SD01 with source document item type as SDOI to RAR.
Once RAI’s are processed successfully, in 1st step system will automatically create one Revenue Recognition Contract 1000000501 against the Sales Order and also create Performance Obligations 2000005001/02/03 for each Sales Order Items.
With reference to Sales Order, Outbound Delivery and PGI done for material relevant order items.
In transaction FARR_RAI_MON or Fiori App Manage Revenue Accounting Items, all fulfillment items related to order will be showcase initially as processable RAI’s. Then all such processable RAI’s are transferred using default sender integration component as SD with RAI class as SD02 with source document item type as SDFI to RAR.
Customer billing has been posted.
In transaction FARR_RAI_MON or Fiori App Manage Revenue Accounting Items, All Invoice Items related to billing will be showcase initially as processable RAI’s. Then all such processable RAI’s are transferred using default sender integration component as SD with RAI class as SD03 with source document item type as SDII to RAR.
Intercompany billing has been posted.
In transaction FARR_RAI_MON or Fiori App Manage Revenue Accounting Items, all processable RAI’s are transferred using default sender integration component as SD with RAI class as SD02 with source document item type as SDFI to RAR.
This is the final step to determine for each POB when revenue should be recognized. Revenue is recognized when POB is fulfilled – that is when Intercompany billing is posted, or goods issue is posted, or services are eligible for post. The system records costs and recognizes revenue based on allocated amounts. The Intercompany billing posting triggers real time creation of the revenue entry recording contract asset based on the allocated revenue. The solution is based on the Universal Journal and provides real time information on the data at point of time.
In transaction FARR_RAI_MON or Fiori App Manage Revenue Accounting Items, RAR Contract details will be displayed with all information related to Order Items, Fulfillment Items and Invoice Items.
In October we can see 33,33% completion of the Service Item
In December we can see 100% completion of the Service Item
We can also see the document flow in Fiori App – Manage Revenue Contracts as below:
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