Revenue Recognition (Unbilled G/L) issue.

[former_member211462]

Dear All,

I came across an issue recently related with revenue recognition. In this business process of OTC this is how it goes:

Creation of Contract => Creation of Invoice => Creation of Invoice list => month end VF44 is run.

Normally after creation of invoice and forwarded to accounting the flow is like this

Customer Dr => Deferred revenue account Cr.( D/R account)

After we run VF44 from D/R account this flows to revenue account.

Now the issue is recently business found out that instead of the Deferred revenue account Cr.( D/R account) its flows to Unbilled receivables account.

But this G/L account is not mapped in VKOA but still after invoice instead of the D/R account is goes to another G/L account(Unbilled G/L)

Customer Dr => unbilled receivables account Cr

Is this the right way ?

In reference with (since in SAP ERP Sales and Distribution (SAP SD) we can only post the answers)

Thanks and Regards

JAGAN N M

[Former Member]

Hi Jagan,

Request you share the screen shot of your Item category used for this.

Regards

Abhishek

[former_member211462]

Dear Abhishek Laghate,

Since I have very less auth. to the following Tcode. Please find the details below.

Item category                         XXXX

Relevant for Billing                  I

Pricing                                    X

Screen sequence grp.              N

PartnerDetProcd.                       N

BOM Application                      SD01

Manual selection for BOM alternatives  X

Business data - item                X

TextDetermProcedure            01

Incompletion procedure        X1

ItemCat.Statsgrp.                    01

Billing Plan Type                      XX

Rev. recog Catgry.                  A

Acc. period start date rule    B

Thanks and Regards

JNM

[Lakshmipathi]

Normally, system would post all non-billed receivables to a special G/L Account based on the settings you have in OVUR.  Have you checked there ?

G. Lakshmipathi

[former_member211462]

Dear Sir,

As you said all non-billed A/r goes to the unbilled G/L which is mapped with Recon. G/L in OVUR.

In the settings OVUR the Recon. G/L and unbilled G/L is configured properly.

In the process the invoice is first not VF44. But in some very few cases there are items of the same

invoice which is posted to the unbilled G/L and also to deferred G/L.

Usually if the VF44 is taking place before VF01 then its unbilled amount, thats fine but here

first is the invoice and invoice list creation then only VF44 runs.(1st of each month)

Thanks and Regards

JNM

[Former Member]

Hi Jagan,

Can you please go through the following navigation and check the settings in it.

SPRO-IMG-Sales and Distribution-Basic Functions-Account Assignment/Costing-Revenue Recognition-Maintain Account Determination.

Check the settings and relevant G/L into it and let me know.Besides go through the VKOA settings also.

Regards

Abhishek

[former_member211462]

Dear Abhishek Laghate,

In the VKOA settings deferred account G/L and revenue account G/L is maintained.

In revenue recognition account determination Recon. acct +Account for Unbilled Receivables + Account for unbilled costs G/L is also maintained.

Thanks and Regards

JNM

[Former Member]

Hi Jagan,

As the process says -

1.) Contract -> Invoice creation(VF01) - Revenue Recognition(VF44). In this, during Invoice creation, accounting entries should be Customer Dr - Deferred Revenue Cr. Hence the receivables amount and deferred account gets generated. Thus in this stage, you are recognizing the revenue at a later stage.

2.) In this, Contract -> Revenue recognition (VF44) - Invoice Creation (VF01), if your client requires that revenue should be recognized periodically and after recognizing then final Invoice creation should be done and sent to the customer, then the amount is kept in unbilled receivables account. This offsets deferred revenue account with revenue.

I think before Invoice Creation, user has used VF44. Please go through the document flow and let me know. I hope it clarifies your issue.

Regards

Abhishek

[former_member211462]

Dear Abhishek Laghate,

At every month starting only VF44 runs and thats done by a background job.

The billing is also created by a background job everyday morning.

Now the document flow shows like VA43-VF01(periodic billing document)-VF21

Since this is a contract the VF44 carried out for previous months is shown in the beginning of the document flow.

Even if we say that VF44 run before VF01. I have found in some cases after creating invoice one of the item is posted to unbilled G/L and the rest goes to Deferred G/L.

Thanks and Regards

JNM