more-arw search

Q&A Forum

NetSuite Revenue Recognition

Hoping to solicit feedback from this forum regarding any experience with the NetSuite RevRec module, which we are in the midst of implementing. It has been explained to us that after the processing of an initial transaction that will be subject to deferment, that we need to go back into each transaction on an individual basis, and for each accounting period, and process a journal entry for the deferred revenue (?!). This was further confirmed by a solutions architect as the "standard" work flow in NetSuite. We've always looked to NetSuite, and experience, great productivity through the additional modules we've added, but this certainly doesn't sound correct. Thanks in advance to the forum for any feedback!

Answers

Anonymous
(Corporate Controller) |

You shouldn't need to go back into each individual transaction. A revenue recognition schedule or revenue commitment is created for each transaction which creates a waterfall of future JE's to be booked as part of a batch process conducted each month.

Sandra Ehn
Title: Sr. Revenue Accountant
Company: VersionOne
(Sr. Revenue Accountant, VersionOne) |

I was a NetSuite user for 2 years and Anonymous is correct; NetSuite has a WaterFall report that is generated based on Rev Rec schedules created at the time the Sales Order/Invoices are generated. What NetSuite does not do, however, is calculate Long Term vs Short Term Deferred Revenue. You will need to create your own process (probably using the Waterfall report) for tracking and do a reclass Journal Entry.

There is a process at the end of each month that you would perform that would post the current month's revenue/deferred revenue.

Lyle Newkirk
Title: CFO
Company: Corrigo Incorporated
(CFO, Corrigo Incorporated) |

We use it and do not need to revisit the transaction after setting it up, assuming it was set up correctly. Our experience with the revenue recognition module has been good.

Peter Viebrock
Title: Staff Accountant
Company: TMG
(Staff Accountant, TMG) |

I know I am a little late to the game, but I will offer my insight. You can do exactly what you are looking to do without revisiting each transaction. However, there are a few steps that you must follow when entering sales orders with deferred revenue.

First, go to the Accounting tab and ensure that the Rev Rec on Rev Commit box is checked. This is imperative.

Next, you must select the appropriate Revenue Recognition schedule and enter the appropriate date range. This step is also very important and can result in errors if done incorrectly. For example, we have a template that is set up to distribute revenue evenly over 4 months at 25%, 25%, 25%, and 25%. If I were to select this template but enter dates that spanned only 3 months, it would skew the revenue recognition and would lead to incorrect revenue commitments and journal entries. Just be sure your template matches up with the appropriate date range.

This is basically all that is required and you can ensure everything is correct before posting each month. Just be sure to check before posting because it is very, very tedious to remedy.

2865 views
Topics
Products and Companies

Get Free Membership

By signing up, you will receive emails from Proformative regarding Proformative programs, events, community news and activity. You can withdraw your consent at any time. Contact Us.

Business Exchange

Browse the Business Exchange to find information, resources and peer reviews to help you select the right solution for your business.

Learn more

Contribute to Community

If you’re interested in learning more about contributing to your Proformative community, we have many ways for you to get involved. Please email content@proformative.com to learn more about becoming a speaker or contributing to the blogs/Q&A Forum.