SECTIONS
This topic explains how revenue schedule lines are generated for source records using a % Complete template for revenue recognition.
Revenue Management generates revenue schedule lines for each incremental difference in a source record's % complete. For example, if you mark a source record as 10% complete in its first period and 25% complete in its second period, the revenue schedule line for Period 1 will be for 10% of the source record's value and the revenue schedule line for Period 2 will be for 15%.
You can adjust a source record's % complete as often as you need. When you generate revenue schedules after adjusting a source record's % complete:
- If an existing revenue schedule line in the same period has the status "Recognizable", it is updated to reflect the new % complete. In the example below, this is illustrated in row 2 where RSL001 is updated from being 10% complete to 20% complete.
- If all existing revenue schedule lines in the same period have the status "Complete", a new line is created in the same period for the incremental difference in % complete. In the example below, this is illustrated in row 4 where RSL002 is created in 2022/001 because RSL001 is "Complete" and cannot be updated.
- If an existing revenue schedule line in the previous period has the status "Recognizable", it is not updated. Instead Revenue Management generates a new line in the current period for the incremental difference in % complete. This ensures that revenue is scheduled and recognized in the period to which it relates. In the example below, this is illustrated in row 8 where RSL005 is created in 2022/003 even though RSL004 in the previous period was "Recognizable".
Example of Revenue Schedule Lines for a % Complete Source Record
Here the source record has a value of 1000. Its start date is January 1 2022, and its end date is March 31 2022.
|
# |
Date |
Action |
Period |
Total % Complete | Revenue Schedule Line | Value |
Status of Revenue Schedule Line |
|---|---|---|---|---|---|---|---|
| 1 | 1/15/2022 | Generate | |||||
| 2022/001 | 10% | RSL001 | 100 | Recognizable | |||
| 2 | 1/22/2022 | Generate | |||||
| 2022/001 | 20% | RSL001 | 200 | Recognizable | |||
| 3 | 1/25/2022 | Recognize | |||||
| 2022/001 | 20% | RSL001 | 200 | Complete | |||
| 4 | 1/29/2022 | Generate | |||||
| 2022/001 | 30% | RSL002 | 100 | Recognizable | |||
| 2022/001 | 20% | RSL001 | 200 | Complete | |||
| 5 | 1/31/2022 | Generate and Recognize | |||||
| 2022/001 | 35% | RSL002 | 150 | Complete | |||
| 2022/001 | 20% | RSL001 | 200 | Complete | |||
| 6 | 2/14/2022 | Generate and Recognize | |||||
| 2022/002 | 50% | RSL003 | 150 | Complete | |||
| 2022/001 | 35% | RSL002 | 150 | Complete | |||
| 2022/001 | 20% | RSL001 | 200 | Complete | |||
| 7 | 2/28/2022 | Generate | |||||
| 2022/002 | 70% | RSL004 | 200 | Recognizable | |||
| 2022/002 | 50% | RSL003 | 150 | Complete | |||
| 2022/001 | 35% | RSL002 | 150 | Complete | |||
| 2022/001 | 20% | RSL001 | 200 | Complete | |||
| 8 | 3/31/2022 | Generate and Recognize | |||||
| 2022/003 | 100% | RSL005 | 300 | Complete | |||
| 2022/002 | 70% | RSL004 | 200 | Complete | |||
| 2022/002 | 50% | RSL003 | 150 | Complete | |||
| 2022/001 | 35% | RSL002 | 150 | Complete | |||
| 2022/001 | 20% | RSL001 | 200 | Complete | |||
| Total | 1000 |
The end result is that five revenue schedule lines are recognized for the incremental differences in the source record's % complete:
|
Period |
Revenue Schedule Line |
Total % Complete |
Incremental % Complete |
Value |
|---|---|---|---|---|
| 2022/001 | RSL001 | 20% | 20% | 200 |
| 2022/001 | RSL002 | 35% | 15% | 150 |
| 2022/002 | RSL003 | 50% | 15% | 150 |
| 2022/002 |
RSL004 |
70% | 20% | 200 |
| 2022/003 | RSL005 | 100% | 30% | 300 |
| Total | 100% | 100% | 1000 |
Additional Information
When you first generate revenue schedules for a source record with a % Complete template, if the source record's start date is in the future and its % complete is zero, Revenue Management generates a revenue schedule header but no revenue schedule line.
You can reduce a source record's % complete to zero even if it already has existing revenue schedule lines. When you next generate revenue schedules, the amount on the latest revenue schedule line will balance the source record's scheduled revenue back to 0% complete.
No new revenue schedule line is generated if a source record's % complete has not changed since revenue schedules were last generated.
If a source record is not fully recognized by its end date, you can continue adjusting its % complete after its end date has passed. Revenue schedule lines are generated and recognized in the period to which they relate, not in the period of the source record's end date.
An alert card on the Revenue Recognition page shows the total amount of unscheduled revenue for all source records using % Complete recognition. For example, if a source record's total revenue is 1000 and 10% has been scheduled, 900 is unscheduled and is included in the amount shown on this card. For more information, see Revenue Recognition Page.