The calculation result can be posted either at performance obligation level or contract level. Revenue Accounting can calculate contract liability and contract asset, or unbillable receivable and deferred revenue, at performance obligation level. You can transfer revenue and cost to the revenue accounting subledger, and also calculate the exchange rate difference from the foreign currency revaluation which generates invoice records from the simplify invoice process.Ĭalculate Contract liabilities and assets Lets us try to understand the three programs in a high level. To recognize the revenue, business users have to execute the above three programs in sequence and post the accounting entries. Revenue Posting run (Also called as Program C).Calculate Contract liabilities and Assets (Also called as Program B).Transfer Revenue (Also called as Program A).Revenue recognition in RAR is mainly handled with 3 programs which are as below If the POB is Percentage of completion, revenue will be recognized over a time based on the percentage of completion of activity. If the POB is time based, revenue will be recognized on certain time or by passage of time. If the POB is Event based, revenue will be recognized on the occurrence of certain event (example, Goods delivery, Acceptance date, proof of delivery etc.) Revenue will be recognized when a performance obligation (POB) is fulfilled. There are 3 different fulfillment types as below. How to recognize the revenue is determined by the Performance obligation fulfillment type. Recognizing the Revenue is the last step in the five step model and it is very crucial step. Allocate the transaction price to performance obligations.Identify the performance obligations in the contract.The principles in the standard will be applied using a five-step model: The main objective of the new standard IFRS 15 is to provide a single, comprehensive revenue recognition model for all customer contracts, improving comparability within and across industries and across capital markets. Get an overview on Direct posting functionality in SAP RAR Understand the posting process in SAP RAR Also, it provides high level overview of direct posting functionality This blog starts by providing a brief Introduction to IFRS (International Financial Reporting Standard) 15 – Revenue from Contracts with Customers and then explains the posting Process in SAP RAR.
0 Comments
Leave a Reply. |
AuthorWrite something about yourself. No need to be fancy, just an overview. ArchivesCategories |