Entering Accounting Distributions

This chapter provides an overview of accounting distributions and discusses how to enter accounting distributions.

Understanding Accounting Distributions

The Accounting Distribution pages enable you to review and adjust the accounting distributions for amount-based contract lines and discounts that are defined for a contract. For each contract line, the Accounting Distribution page stores the accounting distributions separately for the following types of accounting entries: revenue, deferred revenue, and unbilled accounts receivable (AR).

In addition to amount-based contract lines, recurring contract lines utilize the revenue sections of the Accounting Distribution page, and rate-based contract lines with value-based billing plans use the unbilled AR accounting entries. Finally, for revenue forecasting purposes, rate-based contract lines utilize the revenue entries in the Revenue Forecasting grid.

Distributing contract lines depends on your price type:

Price Type	Revenue	Deferred Revenue	Unbilled AR
Amount, Percent	Required	Optional	Required
Rate	Optional	Not applicable (NA)	Required (for value-based billing)
Recurring	Required	Optional	NA

Amount-Based Contract Lines

Each fixed-amount contract line has its own accounting distribution. When you select a product on to a contract line, the system populates the fields on the Accounting Distribution page with the PeopleSoft General Ledger ChartFields assigned to the product. You can then use this page to distribute the contract line amount to various accounts, departments, operating units, and so forth. You cannot activate a contract until you have fully distributed all contract lines and these distributions have passed combination editing.

Rate-Based Contract Lines

For most rate-based contract products, the revenue accounting distribution and unbilled AR come from the Accounting Model’s accounting rules. The Accounting Model provides flexibility because it enables you to set up double-sided accounting rules for revenue, costs, and shared transactions. However, for rate-based products with value-based billing plans, you use the unbilled AR accounting on the Accounting Distribution page. In addition, rate-based contract lines utilize the Revenue Forecast grid on the Accounting Distribution page for revenue forecasting purposes only.

See Setting Up Accounting for Projects.

Recurring Contract Lines

Recurring contract products work similarly to amount-based products. Each line has its own accounting distribution. When you select a product on to a contract line, the system populates the fields on the Accounting Distribution page with the defaults from the distribution sets. The unbilled AR section of this page is not available for recurring products.

Note. For recurring contract lines, PeopleSoft Billing manages revenue and handles deferred revenue processing.

Common Elements Used in This Chapter

Account	Classifies the nature of a transaction. Use for corporate accounts.
Affiliate	Used as one approach for interunit journal processing and consolidated reporting. Provides a way to map transactions between business units while using a single intercompany account.
AltAcct (alternate account) or Alternate Account	Classifies the nature of a transaction for regulatory transactions. Use for statutory accounts.
Dept (department) or Department	Use to indicate who is responsible or affected by the transaction.
GL Unit (PeopleSoft General Ledger business unit)	The PeopleSoft General Ledger unit for the PeopleSoft Contracts business unit with which this contract is associated appears by default. If you select a PeopleSoft General Ledger unit that is different from the Contracts General Ledger unit, the system creates interunit accounting entries when you run the amount-based and rate-based revenue processes. The system performs ChartField combination edits on the row using combination edit rules for the PeopleSoft General Ledger business unit entered. This field is unavailable for contract lines that have a revenue method of Billing Manages Revenue (such as recurring contract lines). For this billing method, revenue is booked to the same PeopleSoft General Ledger business unit as the one associated to the AR accounting through its PeopleSoft Billing business unit relationship.
Oper Unit (operating unit)	Used to indicate a location, such as a distribution warehouse or sales center. Or it is used for responsibility reporting, such as a profit center.
Product	Captures additional information—useful for profitability and cash flow analysis, for example.
Project	Captures additional project ID information that is useful for project accounting.
Stat or Statistics Code	Identifies nonmonetary amounts. Statistic codes are associated with a specific unit of measurement.
Valid	Upon saving the page, the system performs edit checking and selects this check box for each row representing a valid combination of ChartFields. You cannot activate a contract until every accounting line is selected as valid.

Entering Accounting Distributions

This section discusses how to:

Review and update accounting distributions.
Review and update accounting distributions for discounts and surcharges.

Prerequisite

You must have first selected a product onto a contract.

Pages Used to Enter Accounting Distributions

Page Name	Object Name	Navigation	Usage
Accounting Distribution	CA_DETAIL_DST	Customer Contracts, Create and Amend, Fixed Fee Acctg Distribution, Accounting Distribution	Review and update accounting distributions.
Accounting Distribution - Discounts/Surcharges	CA_DETAIL_DST_RED	Customer Contracts, Create and Amend, Fixed Fee Disc/Surc Acctg Dist, Accounting Distribution - Discounts/Surcharges	Review and update the accounting distributions for discounts and surcharges that you have associated with a contract line.

Reviewing and Updating Accounting Distributions

Access the Accounting Distribution page.

Warning! If you use the Commitment Control option to update the revenue budgets in PeopleSoft Receivables, you should use the same revenue distribution lines for amount-based and recurring contracts throughout the life of the contract so that the collected revenue lines are updated correctly when payments are made in PeopleSoft Receivables.

Negotiated Amount	Displays the negotiated amount that is equal to the negotiated amount that was assigned to the contract line on the Negotiated Amount Allocation page. The system creates separate accounting distributions for any discounts to the contract line’s negotiated amount.
Unit	Displays the PeopleSoft Contracts business unit associated with this contract line.

Define Distributions By

These fields are not available for recurring and rate-based contract lines.

Percent	Select to distribute revenue across these rows on a percent basis.
Amount	Select to distribute revenue across these rows on an amount basis.
Calculate Amounts	When you click this button, the system calculates the amount or percent for each revenue distribution row based on any new lines that you added and the percent or amount splits that you specified. You cannot split the unbilled AR accounting distribution across multiple distribution rows.
Discount/Surcharge	Click to review and update accounting distributions for discounts or surcharges that you have associated with a contract line. This link is not available for recurring and rate-based contract lines.

Revenue

The revenue account distribution appears for fixed-amount and recurring contract lines. These values come from distribution sets. You can update the existing row or add additional rows. For rate-based contract lines, this grid is not available.

Percentage	If you are distributing revenue by percent, enter the percent of the negotiated amount or discount amount to apply to the accounting distributions specified for this row.
Amount	If you are distributing revenue by amount, enter the amount of revenue that you want to book to the ChartField combination that you specified for this row. For discounts, specify a negative amount.
Distribution Code	A distribution represents a combination of PeopleSoft General Ledger ChartField values. The system populates the first row with the distribution code that you associated with the product that you assigned to this contract line.

Revenue Forecast

The revenue forecast account distribution appears for rate-based contract lines for use in forecasting calculations. This grid is not available for fixed-amount and recurring contract lines.

Percentage

Enter the percent to apply to the forecasting distributions for this row. The system spreads forecasting across the distributions that you define here.

Deferred Revenue

If you select the deferred revenue check box for an amount-based or recurring contract line on the Contract - Lines page: Deferred Revenue tab, the Deferred Revenue grid appears. This grid is not available for rate-based contract lines.

You can update the existing row or add additional rows up until the time that you run the Deferred Revenue process for this contract line.

The function of the fields within the Deferred Revenue grid is identical to those within the Revenue grid with this exception:

GL Unit

This field is populated by default with the PeopleSoft General Ledger business unit to which the PeopleSoft Contracts business unit is linked. This field cannot be changed. The system does not book any balance sheet entries to a PeopleSoft General Ledger business unit other than the one to which the contract’s PeopleSoft Contracts business unit is linked.

Unbilled AR

The unbilled AR account appears for all contract lines except those with a recurring price type. The unbilled AR account appears by default from the contract line’s product group, or, if no unbilled AR account was specified at that level, it appears by default from the contract line’s PeopleSoft Contracts business unit. The unbilled AR account distributions are editable upon initial entry of the contract line and can be changed up until the time that the contract is activated.

Percentage	If you chose to distribute unbilled AR by percent, enter the percent of the negotiated amount to apply to the accounting distributions specified for this row.
Amount	Display-only field. The system does not use this value for processing.
Distribution Code	A distribution represents a combination of PeopleSoft General Ledger ChartField values. The system populates the first row with the distribution code that you associated with the product that you assigned to this contract line.

Warning! Do not change the unbilled AR accounting definitions on an active contract. The unbilled AR accounting is what keeps your accounting in balance when you separate the timing of your billing and revenue recognition. If you change the unbilled AR accounting on an active contract, the resulting accounting entries in PeopleSoft General Ledger does not reconcile what was billed and what was recognized in revenue.

Reviewing and Updating Accounting Distributions for Discounts and Surcharges

Access the Accounting Distribution - Discounts/Surcharges page.

Seq (discount sequence number)

You can apply one header and multiple line discounts to a single contract line. The system stores each discount as a separate row. You can distribute the revenue for each row to separate ChartField combinations. The sequence number reflects the order in which you created the discounts, but it has no bearing on the order in which discounts are applied; all line discounts are applied at once. If the same line has both a header discount and multiple line discounts, all line discounts are applied at the same time and the header discount is either applied first or last, depending on how you set the header discount Apply Overall After Line check box on the Total Contracts Discounts and Surcharges page.

Amount

Displays an amount that is equal to the discount for the discount sequence. The system creates separate accounting distributions for each discount to the contract line gross amount.

Effective Date

Date on which a table row becomes effective; the date that an action begins.

Note. When creating accounting distributions for discounts or surcharges on renewable contract lines, the system uses the start date of the renewal contract line as the effective date.

Define Distributions By

Percent	Select to distribute discount amounts across these rows on a percent basis.
Amount	Select to distribute discount amounts across these rows on an amount basis.
Calculate Amounts	When you click this button, the system calculates the amount or percent for each revenue distribution row based on any new lines that you add and the percent split that you specify. This button is available only when you select the Percent option.

Discount Revenue

Percentage

If you are distributing discount revenue percent, enter the percent of the discount amount to apply to the accounting distributions specified for this row.

Amount

If you are distributing discount revenue by amount, enter the amount of revenue that you want to book to the ChartField combination that you specified for this row. For discounts, specify a negative amount.

Distribution Code

Displays a distribution code that represents a valid combination of PeopleSoft General Ledger ChartField values. Here are the ways in which this field can be populated:

If this discount sequence represents a line discount ID for which a distribution code had been defined, the system populates this field with that code.
If this discount sequence represents a header discount ID for which a distribution code had been defined, the system populates this field with that code.
You click the Copy Gross Dist (copy gross distribution) button to copy the same account distribution that is used by the contract line gross amount.
You manually enter an account distribution.