Creating Revenue Elements from Journal Entries

You can create revenue elements and revenue arrangements from journal entries. In OneWorld accounts, you can also create them from intercompany journal entries and advanced intercompany journal entries.

You can merge revenue arrangements created from journal entries only when all deferred revenue lines in the journal entry have the same customer. NetSuite then populates the Customer field in the revenue arrangement with a customer name. Otherwise, the Customer field in the resulting revenue arrangement is populated with -Multiple-, and the revenue arrangement is not available for merging. For more information, see Combination and Modification of Performance Obligations.

If you use Multi-Book Accounting, you can create revenue elements only from book-specific journal entries and book-specific intercompany journal entries.

The accounts you use for income in the journal entry must have deferred revenue accounts as their deferral accounts. When you select a revenue recognition rule for the line and save the journal entry, the account is converted to the associated deferred revenue account.

The revenue recognition rule you select for the journal entry line must have Event-Percent based on amount or Event-Percent Complete as its Amount Source. Only rules with these amount sources are included in the Revenue Recognition Rule dropdown list. If you select a rule that uses Event-Percent Complete, you must select a project for that line to prevent errors in element creation.

To create a revenue element and revenue arrangement from a journal entry:

Go to Financial > Other > Make Journal Entries or Make Intercompany Journal Entries.

If you are using Multi-Book Accounting, you use Make Book Specific Journal Entries or Make Book Specific Intercompany Journal Entries.
Complete the journal entry as usual. For guidance, see Making Journal Entries.
On the income account line:
1. Select a Revenue Recognition Rule from the list. The rule you select here can be changed when the revenue element is created.
2. (Optional) Enter a Start Date and an End Date.
  
  NetSuite uses the revenue arrangement creation date as the event date and source date if you do not include a Start Date.
The Name column is required if you want to be able to merge the resulting revenue arrangement. The value you select must be a project if the Revenue Recognition Rule uses Event-Percent Complete as its Amount Source.

After you save the journal entry, the revenue elements, revenue arrangements, and revenue recognition plans are created as usual. For more information, see Updating Revenue Arrangements and Updating Revenue Recognition Plans. After revenue elements are created, you cannot change the Revenue Recognition Rule selected in the journal entry. The only journal entry fields that are synchronized with revenue elements and plans after creation are the Debit and Credit amount fields.

A revenue element is created for each line in the journal entry that has a deferred revenue account. The Item and Quantity fields in the revenue element are blank, and the Allocation Type is set to Exclude. This Allocation Type field appears only when the Advanced Revenue Management (Revenue Allocation) feature is enabled. For more information, see Enabling the Advanced Revenue Management (Revenue Allocation) Feature. The resulting revenue elements are grouped by subsidiary, accounting book, currency, and source journal entry into revenue arrangements.

To create a revenue element and revenue arrangement from a journal entry:

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