I have a question regarding the ARM option, "CREA...
# armm
Muzzyelk
09/06/2022, 12:12 PMI have a question regarding the ARM option, "CREATE AND MAINTAIN REVENUE ELEMENT UPON CLOSED ORDER". We have been closing line items on Sales Orders and this option was checked. There is limited information on this option but I think it is the correct thing to uncheck, is this option retroactive? Meaning will it adjust the revenue elements for anything that has been closed, or would it only adjust elements going forward. Can some one give me a quick breakdown of what types of adjustments this makes to deferred/and or Revenue. If it has undesired consequences can it be rechecked? We only use Sales Orders for Professional services and realized we have extra noise in Def Professional Services. Thanks in advance
Muzzyelk
09/06/2022, 2:00 PMI tried this in sandbox on a line item with a quantity of 4 that we closed but we recognized revenue on. It made no changes to the revenue plans. I was able to edit the quantity to 0 on the sales order (essentially closing it), and it updated the arrangement and the allocation of revenue and corrected the recognized revenue. I don't think I want to edit the sales order quantity. I am thinking I need to match the Rev Rec % to the billed % and just leave what is done and going forward hopefully unchecking that box will stop the bleeding, now it is just how to fix what has broken
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Karina
09/06/2022, 7:06 PM@Muzzyelk - it will probably help to understand the consequences of checking and unchecking this box in SA 106452.
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Muzzyelk
09/06/2022, 7:12 PMI have looked for that answer before and never found that SA, good to know it is prospective, so I can stop the bleeding but will still have to fix the past, thank you so much
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Muzzyelk
09/06/2022, 7:16 PMSo in your opinion since we have the process of closing sales orders instead of "writing off" unused items we need to uncheck that box and any SO closed from today forward will adjust but anything prior will need to be corrected manually. The right choice is to uncheck before anyone processes Sept Orders/Write offs
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Karina
09/06/2022, 8:09 PMthe best practices actually is to have the box always checked. for any changes you need to create a return authorization that will manage counter to the original sales order and then you merge two revenue arrangements. you do not really want to delete anything and that’s what unchecking the box doing to your records. if this is for the old data fix that was incorrectly uploaded - that’s fine, but as ongoing process i would never advise it
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Muzzyelk
09/06/2022, 10:35 PM@Karina We were trying to avoid the additional transactions by closing the SO line. It is a very long process to Invoice, Return Auth, and generate a CM. Another issue with unchecking the box is that if a JE has been created for revenue recognition. unchecking the box wont allow the SO to be closed nor an adjustment to the revenue.
Muzzyelk
09/06/2022, 10:38 PMWe have a lot of write offs where we book 2 education classes and they attend one and we want to close the SO line it will not allow it if we have already recognized revenue on the first unit. I had hoped that it worked much like the note at the bottom of SA80840 which states "Note: When you update the revenue arrangement or plans with the date the SO is closed, it would change the amounts based on what was invoiced and the remaining amount to be recognized.
In cases where revenue recognized is more than what was billed upon the closing of the sales order, the system will create additional lines on the revenue plan with a negative amount for the discrepancy, so you can recognize the negative amount to correct the deferred revenue and income."
Muzzyelk
09/06/2022, 10:38 PMI see now that it probably only applies when nothing on the line has been recognized or billed, Essentially deleting the line
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Karina
09/07/2022, 12:04 AMyou may want to speak with your controller about it. while it does seem prudent to just delete cancelled transactions this is not what you may want to do. of course you recognized revenue on your first unit, but you also want to keep track of those cancelled orders; there is a merge functionality that addresses new allocation as well. Not knowing more about how you recognize revenue i suggest you discuss it at length internally
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