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, contract liability, and contract asset.
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 contract asset 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 |
Contract Liability |
Contract Asset |
|---|---|---|---|
|
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 contract asset 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 contract asset 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.
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 contract asset section of this page is not available for recurring products.
Note: For recurring contract lines, PeopleSoft Billing manages revenue and handles contract liability processing.