3599762 - Outgoing Invoices From Contracts Posted Directly To Revenue Account Instead of Deferred Revenue

• A customer invoice ABC was created, for customer contract XYZ - AA item. (ABC represents the Customer Invoice ID, XYZ-AA represents the Customer Contract Item).
• The Revenue is posted to direct sales revenue even though the service period of the contract does not start until a future date.
• Expectations is that the customer invoice is posted to deferred revenue.

SAP Business ByDesign

1. In the Customer Invoicing work center go to the Invoice Documents view.
2. Find customer invoice ABC.
3. Press Edit and then View All. 
4. Open the Document Flow tab.
5. Select the journal entry icon of customer invoice ABC.
6. The invoice has been posted directly to a revenue account. The expectation is that the invoice be posted as Revenue Deferral.

At the time of the customer invoice posting there was no accrual method assigned to customer contract item XYZ-AA.

If no accrual method is assigned to the customer contract item the revenue is directly posted to the respective revenue account. 

Customer invoices are posted as revenue deferral only if the related customer contract item is using an accrual method. 

To confirm this behaviour check the following:

1. Go to the Cost and Revenue work center.
2. Go to View: Customer Contract Item
3. Find Customer contract item XYZ-AA.
4. Go to the Accounting Data tab and verify that an accrual method is assigned to the item.

The question is why no accrual method is assigned to the customer contract item. 

Check if at time of the creation of the customer contract item XYZ-AA.

1. Go to the Business Configuration work center.
2. Go to the Overview view.
3. Find and open the activity Accrual Method Determination.
4. Click add row.
5. Select the Revenue Type 5 - Customer Contact (Fixed Price), if wished maintain further specify Product category or Product, select one of the accrual method for customer contracts.

Note the time of creation of the customer contract item XYZ-AA the settings in the Accrual Method Determination were missing.

Revenue Recognition, Outgoing Invoices, Contracts, Accrual Method, Deferred Revenue,  , KBA , SRD-FIN-COR , Cost & Revenue , SRD-FIN-GL , General Ledger , Problem