Revenue Recognition Rules

Revenue recognition rules define how revenue recognition plans are generated after a revenue element is created.

You can create multiple rules to define the terms under which revenue is deferred. These revenue recognition rules are used to generate revenue recognition plans that determine when and how revenue from associated items should be recognized.

For each rule, you can:

Select from standard revenue recognition methods
Set the time period over which revenue is recognized
Define an offset to delay the start of recognition
Set up an initial amount to be recognized
Select the source of the revenue recognition plan amount
Select the trigger for plan start and end dates
Determine how the plan is modified if the end date changes

Revenue recognition rules cannot be edited after they have been used to generate a revenue recognition plan. The exception is that the rule name can be changed. You cannot delete revenue recognition rules after they have been used.

For details of the options available for rules, see Revenue Recognition Rule Field Reference.

For steps for creating a new rule, see Defining a Revenue Recognition Rule.

When you enable Advanced Revenue Management (Essentials), system-generated default revenue recognition rules are created. These revenue recognition rules cannot be edited except to change their names. System-generated rules cannot be deleted. The following are the system-generated rules:

System-Generated Revenue Recognition Rule	Description
Default Standard	This rule defines revenue recognition plans that begin and end on the same date. The result is that revenue is recognized as soon as the revenue recognition journal entries are created.
Default One-Time Direct Posting	All elements in a revenue arrangement use this rule when the source transaction includes a posting discount. For more information, see Discount and Markup Items in Advanced Revenue Management (Essentials).
Default Percent Complete	This rule is for projects that are attached to a sales transaction. It appears only when the Projects feature is also enabled. For information about recognizing revenue directly from charge-based projects, see Project Revenue Recognition.

System-Generated Revenue Recognition Rule

Description

Default Standard

This rule defines revenue recognition plans that begin and end on the same date. The result is that revenue is recognized as soon as the revenue recognition journal entries are created.

Default One-Time Direct Posting

All elements in a revenue arrangement use this rule when the source transaction includes a posting discount. For more information, see Discount and Markup Items in Advanced Revenue Management (Essentials).

Default Percent Complete

This rule is for projects that are attached to a sales transaction. It appears only when the Projects feature is also enabled. For information about recognizing revenue directly from charge-based projects, see Project Revenue Recognition.

The following system-generated review recognition rules appear only when the SuiteBilling feature is also enabled. For more information, see Revenue Recognition for SuiteBilling.

System-Generated Revenue Recognition Rule	Description
Default Adjustable Recurring Fee	This rule is for recurring-adjustable subscription rate plans only when the accounting preference Create Revenue Elements for Subscription Revisions box is clear. For more information about this accounting preference, see Setting the Optional Accounting Preference for Advanced Revenue Management in the SuiteBilling documentation.
Default Fixed Recurring Fee	This rule is for all subscription rate plans except usage when the accounting preference Create Revenue Elements for Subscription Revisions box is checked. For more information about this accounting preference, see Setting the Optional Accounting Preference for Advanced Revenue Management in the SuiteBilling documentation.
Default Usage	This rule is for usage subscription rate plans.

System-Generated Revenue Recognition Rule

Description

Default Adjustable Recurring Fee

This rule is for recurring-adjustable subscription rate plans only when the accounting preference Create Revenue Elements for Subscription Revisions box is clear.

For more information about this accounting preference, see Setting the Optional Accounting Preference for Advanced Revenue Management in the SuiteBilling documentation.

Default Fixed Recurring Fee

This rule is for all subscription rate plans except usage when the accounting preference Create Revenue Elements for Subscription Revisions box is checked.

For more information about this accounting preference, see Setting the Optional Accounting Preference for Advanced Revenue Management in the SuiteBilling documentation.

Default Usage

This rule is for usage subscription rate plans.

After revenue recognition rules have been created, you associate them with items. The Default Standard rule is set for all existing eligible items when you enable Advanced Revenue Management (Essentials). You should change it as appropriate on the item records. The revenue recognition rule you select on the item record becomes the default rule when the item is sold. See Item Configuration for Advanced Revenue Management (Essentials) and (Revenue Allocation).

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