Result Analysis Valuation Method 3

[Former Member]

Hi PS Experts, The building block document on Profit Realization 'I58_BB_ConfigGuide_EN_DE' says that as per IAS 11 and 18, we need to configure Result Analysis Valuation Method 3 only which is cost based. Is it right and whether you are all having this valuation method in your SAP system where IFRS standards are applicable. Then, in addition to this cost based Revenue Recognition through this valuation method 3, we would like to input realistic POC(Engineer's certificate) into the system. Whether it is possible and if so, how and what other valuation method we need to use with or with changes to a particular valuation method. Appreciate your valuable inputs on this. Regards!

[Former Member]

It is ok, partially answered pl.

[Former Member]

Hello,

Cost based POC i.e Method 3 is compliant with IFRS requirements. Other methods also are so.

The choice of RA method depends on value/risk/duration/revenue plan of the project. We use this method for high value projects running for a long time where there is a need to recognise revenue before actual billing.

Completed contract method is also used and very much in accordance with accouning principles.

For POC calculated through progress determination- say Engineer's certificate- you can use method 7.

Thanks,