- In Feature Console, enable the Create Setup for Using Revenue Contracts feature to automatically create recognition settings and templates for revenue contracts and performance obligations.
- Identify the source objects that will be used to create performance obligations on revenue contracts.
- On the performance obligation line item object, add a lookup to each source object that will be used to create performance obligations. Make sure these lookup fields are added to the page layout for the performance obligation line item. This is so that you can see which source record is linked to a performance obligation line item.
- Create "Use in Revenue Contract" recognition settings records
A recognition settings record that has the Use in Revenue Contract checkbox enabled. for the source objects that will be used to create performance obligations. For example, if your primary source object is Project, and its level 2 source object is Milestone, and you intend to create performance obligations from milestones, you must create a "Use in Revenue Contract" settings record for the Milestone source object. If you already have a settings record for a source object for revenue recognition processing, you can clone it and change the fields detailed below: - Enable the Use in Revenue Contract checkbox. By default, source records being processed for revenue from contracts are excluded from revenue recognition and forecasting processes. See About Parallel Reporting for more information.
- In the POLI Source Lookup field, specify the API name of the lookup field on the performance obligation line item object that identifies the source record. (This is the lookup you created at step 3.)
- In the SSP field, specify the API name of the field on the source record that contains the standalone selling price for the performance obligation line item. Your business processes must ensure that the SSP field is populated on source records. You do not need to populate this field if the settings record has a Value Type of Cost only.
- Once the recognition settings record is finalized and you have given it a unique name, save it then click the Create Mapping button to generate the field mapping definition that will allow performance obligation line items to be populated with information from the source record.
- Create a recognition template for each recognition settings record you created in step 4.
- You can now start creating your revenue contracts, performance obligations, and performance obligation line items.
- [Optional] Edit the values in the Legislation Type picklist on the Recognition Transaction custom object to reflect the legislation types relevant to your business. The default values available are ASC 605, ASC 606, and blank but you can rename these values and add more. You can pick a legislation type when you submit revenue for recognition on the Recognize Revenue page. You might want to do this for reporting purposes.
Legislation Type
If you do not need to record legislation type in your org, you can use the Legislation Type picklist for something else. Simply change the Field Label for the picklist on the Recognition Transaction custom object, and create appropriate picklist values for users to select when they submit revenue for recognition on the Recognize Revenue page.
Automatic Generation of Recognition Schedules for Revenue Contracts
When revenue contracts are created asynchronously (typically via the API) recognition schedules are generated automatically for the revenue contracts. You can disable this automatic generation of recognition schedules by setting the Disable Generate Schedules for Contracts field in the Revenue Management Settings custom setting to true. You might want to do this if you are not using recognition schedules, or have another reason for not wanting them to be generated automatically.