Managing Accounting Distributions for Withholding
When the Contracts Billing Interface process (CA_BI_INTFC) generates withholding and release rows, the system assigns one of the following analysis types to the transactions that are ultimately passed to PeopleSoft Billing and PeopleSoft Project Costing:
WTH: Withholding analysis type assigned to withholding transaction rows.
WRL: Withholding release analysis type assigned to release transaction rows.
WWO: Withholding write-off analysis type assigned to withholding rows that are written off instead of released.
WAJ: Withholding adjustment analysis type assigned to adjustments to withholding transaction rows that are generated as a result of adjusting a withholding invoice line in PeopleSoft Billing.
WRJ: Withholding release adjustment analysis type assigned to adjustments to release transaction rows that are generated as a result of adjusting a withholding release invoice line in PeopleSoft Billing.
For rate-based contract lines, PeopleSoft Contracts uses accounting rules defined in PeopleSoft Project Costing to generate the appropriate accounting entries for transactions that occur against the contract lines. Accounting rules are defined by business unit and analysis type. Analysis types are used to determine which accounting rule is used to generate the appropriate accounting entries for a particular transaction row.
Withholding and release functionality is only applicable to rate-based contract line types and therefore requires accounting rules to generate its accounting entries. To generate accounting entries for all of your withholding and release scenarios, you must define accounting rules for each withholding analysis type for every business unit where withholding and release scenarios may occur.
Note: Because PeopleSoft Contracts uses an contract asset account to book accounting entries for withholding and release transaction rows, when setting up your accounting rules for WTH and WRL rows, you should use the same contract asset account code. This will ensure that your accounts remain in sync.
Accounting Entry Example for Withholding Transactions
When you process a withholding transaction, the system generates a transaction row with an analysis type of WTH. PeopleSoft Contracts sends an contract asset accounting entry to PeopleSoft Billing. PeopleSoft Billing creates the balancing accounting entry.
In this example, you have billed your customer for accumulated costs on a contract and 1,000.00 USD has been withheld from the invoice. The system creates the following accounting entries for the withholding transaction:
|
Account |
Debit |
Credit |
|---|---|---|
|
Contract Asset |
1000 USD |
|
|
Accounts Receivable |
1000 USD |
Accounting Entry Example for Release Transactions
When you process a withholding release transaction, the system generates a transaction row with an analysis type of WRL. PeopleSoft Contracts sends an accounting entry to PeopleSoft Billing to relieve the Withholding Contract Asset account. PeopleSoft Billing creates the balancing accounting entry.
In this example, you are releasing 650.00 USD from the previous amount withheld and billing the amount to the customer. The system creates the following accounting entry for the withholding release row:
|
Account |
Debit |
Credit |
|---|---|---|
|
Contract Asset |
650 USD |
|
|
Accounts Receivable |
650 USD |
Accounting Entry Example for Writing Off Withholding Amounts
If you are writing off a withholding amount instead of releasing it, you create a release row for the amount and select the release option of Write Off. The Contracts/Billing Interface process creates a transaction with a WWO analysis type and this data is passed to the Project Transaction (PROJ_RESOURCE) table in PeopleSoft Project Costing. The As-Incurred revenue process (PSA_ACCTGGL) creates the accounting entries for this type of transaction.
In this example, you are writing off 350.00 USD from the previous amount withheld instead of billing the customer. The As-Incurred revenue process uses the accounting rule defined for the WWO analysis type to create the following accounting entries:
|
Account |
Debit |
Credit |
|---|---|---|
|
Contract Asset |
350 USD |
|
|
Revenue |
350 USD |