Showing results for 
Search instead for 
Did you mean: 

Use of Revenue Recognition for Sale from Stock for Delayed invoicing


Hi fellow members,

Wish you all Happy Holidays !

We have a business scenario where the customer sales scenarios are based on consignment model. The scenario is in the health care industry with implantable devices.

Stocks are kept at the customer location and the customer is billed only when the products have been consumed.

In order to be able to invoice the customer, a formal consumption PO is expected from the customer as each consumption is typically tied to a specific procedure. The challenge is that there maybe a gap between the acknowledgement that a product has been consumed and a formal PO from the customer in order to be able to invoice the customer.

Since revenue guidelines require cost and revenue to be posted in the same timeline and delaying reporting the consumption would show incorrect details on implantable devices, it seems that there is a need to record cost, but accrue the revenues and customer A/R.

SAP seems to have revenue recognition keys that support sales from stock ( I think key as EBRR ? ) and I wanted to seek inputs from the esteemed forum if this would be a perfect fit for such a scenario.

The customer is on S/4 HANA On premise 2021 version.

Appreciate your inputs and Happy Holidays !


Rohit Zalani

Accepted Solutions (0)

Answers (0)