Pricing procedure not to bill customer but revenue recognition

[Former Member]

I'm looking for guidance on how to setup a pricing procedure conditions.   First let me explain the situation.  What happens is the customer buys say 2000 software licenses on a sales order. The customer is billed and the customer account is debited and a deferred account is credited. Now the customer activates one of the licenses. The pricing from the sales order is copied to a contract. This contract has a start and end date for the license. Now that license can start to be recognized based on the period of the line item contract dates.. The issue we have is that normally for deferred revenue billing takes places. Problem is customer was already billing on the sales order. Somehow the pricing procure has to credit the deferred account that was posted on the sales order and then credit the revenue recognition account that can be used by transaction VF44.

So on the invoice associated with the sales order Invoice  from sales order

Dr Customer $1000

Cr 2370 $1000

The account 2370 is the deferred account. This part is fine.  

Now we activate 1 of the licenses.

So the pricing procedure has to do the following with no billing to the custo0mer account Invoice from contract

Dr 2370 $120

Cr 2371 $120

This is the problem part. crediting the deferred account 2370 and then posting into the revenue recognition account 2371

Rev Rec – VF44 for Period1

Dr 2371 $10 Cr 4340 $10 Any ideas would be appreciated

[hasan_ahmed1]

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[Lakshmipathi]

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[hasan_ahmed1]

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[Lakshmipathi]

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[moazzam_ali]

Hi

In SD billing documents customer is always debited or credited based on nature of transaction. For posting in two different G/Ls instead of customer account there is only one possible way which I know. In free goods pricing system can post debit and credit entries to different G/Ls and these G/Ls are controlled through account keys which you assign to condition types in pricing procedure.

Do you have any Idea of free goods pricing and its posting? Explore this and give it a try. I am not sure about this because I didn't test this. You can test and see if it helps.

In this for contract item category you have to use free goods pricing which you set in item category settings in VOV7.

Thank$

[Former Member]

Hello Moazzam,

firstly thanks for replying.

We would still want to do rev rec so I wouldn't have the that was possible on free goods.  My thought was to maybe 100 % discount the net price and then create 2 new conditions that post to the these accounts they would pick up the values from the net pricing before the 100% discount.