Revenue recognition allows you to view, search and adjust the distribution of revenue for a project, business unit or entire project portfolio. This means you have the ability to determine when revenue is recognized, either before (accrued) or after (deferred) project invoicing and payment.
Revenue recognition is available in Platinum and Enterprise versions.
For example, if a project will take several months to complete and the customer will make payments at the beginning and end of the project, you are able to recognize revenue for every month in which services are rendered instead of having two high revenue months with no revenue for the intervening months.
When Revenue recognition is in use, it is not possible to enter revenue forecasts manually for projects in project's Financials-tab.
Lock entries is a permanent and irreversible control which prevents entering and editing revenue for all projects by any person other than the system administrator.
To Lock entries for a month and all prior months, go to Settings > Organization > Revenue recognition. Click to mark the checkbox in front of Lock month and click the calendar icon to open and navigate to select a date. After saving, a confirmation message will appear in a pop up window to verify that you want to lock entries, click Yes or Cancel as intended.
If entries for a given month are locked in Revenue recognition, new revenue entered for that month will be pushed to the first unlocked month following the Date of entry.
Revenue can be further distinguished by Cost centers (also used as revenue centers). Cost centers allow you to provide more information about how income is generated by identifying the business unit, department or other division responsible.
How to enable Cost centers:
- Go to Settings > Organization > Revenue recognition
- Click the Enable cost centers checkbox, and Save
- After saving, navigate to Settings > Organization > Financial details > Cost centers
- Create the cost centers by providing names, assigning unique identifiers and selecting a default
If revenue was generated prior to the use of Revenue recognition and Cost centers, an additional cost center entitled Other revenue is visible. This field contains all revenue that was created previously, and revenue can be moved to or from this field as with any other cost center.
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