Understanding Revenue Commitment Fields

Important:

The functions discussed in this topic require the Revenue Commitments feature to be enabled.

By default, one field related to revenue commitment displays in the Revenue section of the Accounting subtab, the Rev Rec on Rev Commit. check box. After you select this option, other fields become available. NetSuite displays the Accounting subtab on the following transaction forms:

Cash Sale
Credit Memo
Invoice
Refund
Revenue Commitment
Revenue Commitment Reversal
Sales Order

The following fields may be available under Revenue on the Accounting subtab:

Rev Rec on Rev Commit.
Revenue Status
Rev. Commit. Status
Recognized Revenue
Deferred Revenue
Discounts and Subtotals
Transaction is VSOE Bundle – For information about this field, see Using VSOE on Sales Orders and Invoices.

Rev Rec on Rev Commit.

This field displays Yes or No to indicate whether or not revenue on this transaction is recognized using a revenue commitment or an invoice. When creating a sales order, this item on the Accounting subtab initially appears as an unchecked check box. You can use form customization to set the default value.

If the transaction is an intercompany transaction and Rev Rec on Rev Commit. is checked, the deferred revenue account for all items must support intercompany elimination. To support intercompany elimination the Eliminate Intercompany Transactions box on the account must be checked.

Revenue Status

The Revenue Status field can display the following values:

Pending – No revenue recognition has occurred, therefore all revenue remains deferred.
In Progress – Some revenue recognition has occurred.
Completed – All revenue recognition has occurred, leaving no deferred revenue.

If you cancel or manually close a sales order before recognizing revenue for all items on the order, the status would be based on the status of the transaction at the time. For example, if you had a sales order with an amount of $100, but closed it after only recognizing $80, then the status would be In Progress. In this case, you should use a return authorization and revenue commitment reversal to offset the full amount of the sales order and the revenue commitment.

NetSuite displays this field if the Revenue Recognition feature is enabled. The field does not require the Revenue Commitments feature to be enabled.

Rev. Commit. Status

The Rev. Commit. Status field can display the following values:

Pending Commitment – No revenue commitments created.
Partially Committed – Some revenue commitments created.
Committed – All revenue commitments created.

Important:

The status NetSuite displays depends on the status of invoices, as well as revenue commitments. If the Rec Rev on Rev Commit box on a sales order is not checked, the Rev. Commit. Status is based on the partial or fully completed status of the invoices for the sales order. In this situation, the invoice becomes the revenue commitment document.

Recognized Revenue

The cumulative dollar amount of the revenue recognized with either invoices or revenue commitments. NetSuite displays this field if the Revenue Recognition feature is enabled. The field does not require the Revenue Commitments feature to be enabled.

Deferred Revenue

The cumulative dollar amount of the revenue deferred with either invoices or revenue commitments. Revenue is deferred by using revenue recognition schedules. For more information, refer to Working with Revenue Recognition Schedules.

Discounts and Subtotals

Discounts and subtotals on revenue commitments work like they do on invoices with the Convert Absolute Discounts to Percentage preference enabled (Setup > Accounting Preferences > Order Management > Invoicing). NetSuite automatically converts absolute discounts to percentages when it copies lines from a sales order or return authorization to a revenue commitment or revenue commitment reversal. This means that if you partially commit, the discount will be proportionately applied. It also means that in certain cases the number may change slightly due to rounding.

For example, consider a sales order with the following lines:

Line	Item	Amount
1	19” Monitor	$250
2	Discount	$(50)
	Sub-total	$200

Line	Item	Amount
1	19” Monitor	$250
2	Discount	20%
	Sub-total	$200

Shipping, Handling, Payments, and Tax Items

Revenue commitments do not display these items, which only appear on invoices.