Revenue Recognition for Service Agreements
Expandable’s REVENUE RECOGNITION module records and manages accounting entries for service agreements related to subscriptions and warranties.
MODULE FEATURES
TWO TYPES OF SERVICE AGREEMENTS:
- Prepaid Subscription Revenue:
- Where a company invoices their customers, for an upfront payment, for the right to use a product or to obtain services over a specific period of time.
- The duration of the subscription period is typically twelve months.
- Prepaid Warranty Subscription Revenue:
- This is a special type of subscription revenue in that the service is tied to a specific product/serial number combination and therefore this information must be captured.
Revenue Recognition Service Agreement Editor
Revenue Recognition Service Agreements can be viewed and edited in the service agreement editor which also shows the JV adjustments by agreement, forecasted monthly amounts for the agreement to be recognized over time, recognition process approval or disapproval.
An ample number of user fields are also available for the agreement.
Revenue Recognition Reports
Reports delivered with the Revenue Recognition module provide information to aid in analysis, audits and forecasts.
- Deferred Balances Report
- Deferred Quarterly Balances Report
- Not Approved Report
- Prepaid Service Adjustments Report
- Recognized Quarterly Balances Report
- Recognized Revenue Balances Report
- Prepaid Service Revenue Rolloff Report
- Revenue Recognition Skipped Invoices Report
- Revenue Recognition Summary Report
Create Service Agreements Utility
The Create Service Agreement utility creates revenue recognition agreements from Invoices created for subscription or warranty parts.
Recognize Revenue Utility
The Recognize Revenue Utility is run at month end as part of the month end close process to realize revenue pertaining to the current fiscal period. It also re-calculates the long and short term deferred balances for the ending month.
Monthly Detail Utility
The Revenue Recognition Create Agreement Monthly Detail is run to resolve service agreements that are created without corresponding fiscal calendar records. After required fiscal period records are added, this utility is run to move revenue dollars from the Revenue Recognition Clearing account to the appropriate long and short term deferred revenue accounts.
The Revenue Recognition Service Agreement Editor