SD RR migration to SAP RAR

[edwardcs]

Dear @madhusudhantc @sanil.bhandari, and all,

Below is our 'As Is' revenue recognition process using the standard SAP SD RR module. It is time-based recognition. We are planning to migrate this SD RR process to SAP RAR.

We understand that once we activate SAP RAR, contracts created by transaction code VA41 will flow to SAP RAR and RAIs will be created.

Our question is, what happens with the VF04 (Actual billing to Customer) process once we migrate to SAP RAR?

[Kartik_Dua · Accepted solution]

At an high level, when a contract is sent to RAR and it is not yet invoiced, amount is sitting in unbilled. As soon as billing is complete, entries move from unbilled to revenue. There are equivalent entries posted in IC to settle accounting. Opposite process happens when contract is billed but no revenue is run. Amount sits in deferred until revenue is run and the postings happens as explained by Naveen. Please read through this article to understand things in detail - https://help.sap.com/doc/2b7b6eedea0c4428bebd966e0e0b6d27/1.3%20SP10/en-US/loio79dde25341d61e4ee1000...

If there are specific follow ups, please revert and will be happy to look into it.

Thank you.

Kartik

[edwardcs · Accepted solution]

Hi Kartik, thanks for your response. To confirm my understanding, Billing creation process (VF04) stays in SD module, it is not replaced by any tcode from the SAP RAR module. Both documents, contract (VA41) and billing document(VF04) will flow to SAP RAR. From the picture perspective, what will be replaced is only the SD RR tcode VF44 by a new tcode in SAP RAR. Please cmiiw.

[Kartik_Dua · Accepted solution]

That is correct. Only traditional rev rec moved to RAR. All other transactions will flow from source system (which is SD in our case).

Thank you.

Kartik

[edwardcs · Accepted solution]

Hello Kartik,

Our migration from SD RR to SAP RAR is in the context of ECC 6 conversion to S/4HANA. The migration to SAP RAR is a prerequisite for the conversion.

In this context, do we need to only migrate open documents (contract, billings) from SD RR to SAP RAR?

If yes, what happens to those closed/completed SD RR documents once we migrate to S/4HANA? can we still open the documents (as we know SD RR is no longer exist in S/4HANA)?

[Kartik_Dua · Accepted solution]

You may not like my answer, but it all depends on what your business needs and expectations are 🙂

When we went through our migration, we explained to business the complexities involved in migrating open documents. We also asked Finance and Accounting folks what is the basic requirement from the "books closing" standpoint. We looked at the volume of open sales order/billing etc. Basically, we weighed out the pros and cons to understand the ROI of going through the Data Migration exercise.

Once we had a clarity on the above topics (and few others which I am unable to recap), we decided we will migrate open sales orders/contracts.

Now coming to the 2nd half of your question - typically when we leave close documents in legacy system, we go with the assumption they are not needed in the new system. When I say not needed, I mean there no need to perform any transactions on them. We normally need legacy data for reporting, for that purpose we have tried few things in the past - cloned data and moved it to the new system, took a data back and moved to the external reporting system, or just left it in the old system and visited the system when the need for the data arises.

So without knowing the actual knowhow of your business and system, unfortunately I will not be able to give point blank answers. But hopefully my recommendations and the experiences I have shared, helps you arrive at the decision you are looking for.

Good Luck!

Thank you.

Kartik

[former_member708798]

Dear,

what happens with the VF04 (Actual billing to Customer) process once we migrate to SAP RAR? Billing documents are processed through FARR_RAI_MON and invoice amounts are updated in the Revenue schedule report. Tables- FARR_D_INVOICE.

Accounting Entry at the time of Billing -

Customer A/c Dr

Service Income/Sales Income A/c Cr

During the month end-

Invoice amount reversed-

Revenue Adjustment A/c Dr

Receivable Adjustment A/c Cr

Regards

Naveen

[edwardcs]

Thank you, Naveen. Your reply is much appreciated.