Revenue Accounting

Amount-based Contract Lines

When you select a product onto a contract, the system populates the revenue distribution accounting based on distribution sets to the revenue fields on the Accounting Distribution page. Additionally, the PeopleSoft General Ledger business unit on the accounting distribution is populated with the PeopleSoft General Ledger business unit associated with the PeopleSoft Contracts business unit of the contract. The PeopleSoft General Ledger business unit and revenue accounting distribution are editable for each fixed-amount contract line on the Accounting Distribution page. You can edit the existing revenue accounting distribution or split the revenue across multiple accounting distributions (such as departments). When you save the Accounting Distribution page, the system performs combination editing to ensure that the combination of ChartFields that you specify are valid for the selected PeopleSoft General Ledger business unit.

When you save the Accounting Distribution page, the system performs combination editing to ensure that the combination of ChartFields that you specify are valid for the selected PeopleSoft General Ledger business unit.

In addition to ChartField Combo-Editing, the system checks to ensure that the amount distributed on the Accounting Distribution page equals the amounts on the contract line defined on the billing allocation page and revenue allocation page. The revenue amount on the contract line may be different than the billing amount on the contract line if the contract separates billing and revenue on fixed amount contract lines. If not separated, then the revenue amount will equal the billing amount. If you complete amount allocation after you distribute the accounting, an error may appear. If ChartField Combo-Editing or distribution amount errors exist, you see an Action Required link on the Details tab of the Contract - Lines page.

WARNING:

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

Rate-based Contract Lines

For rate-based contract lines, the revenue distribution accounting is defined by using accounting rules through the As Incurred Accounting Distribution page. Like distribution sets, rate-based accounting rules may reference distribution codes for ease of use. However, each accounting rule allows only one revenue distribution to be defined. When forecasting revenue for rate-based lines, use distribution sets with distribution codes.

Recurring Contract Lines

For recurring contract lines, the system handles the accounting similar to fixed-amount. The system populates the revenue distribution on the Accounting Distribution page based on distribution sets. If the revenue distribution code in the distribution set has a related contract liability distribution code, the system also populates the contract liability distribution on the Accounting Distribution page.

WARNING:

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