Recognition Schedules and Calculations Overview

If you do not recognize revenue directly through recognition schedules, the values and calculations might appear inconsistent. This occurs because Revenue Management distinguishes between the initial creation of a schedule and its subsequent updates.

Generation Scenarios

The schedule generation is handled differently depending on the scenarios:

• First-time Generation: This occurs when you create a schedule for the first time or regenerate it after deleting an unrecognized schedule. Revenue Management distributes the value of the source record across the full duration of the schedule.
• Regeneration: This occurs when you synchronize schedules after modifying the source record, for example, if you recognized revenue outside the recognition schedules.

Calculation Adjustments

When schedules regenerate due to changes in the source record, the adjustments depend on the calculation adjustment type defined in the recognition template:

• Retrospective Adjustment: Adjusts the entire schedule by distributing changes over the full period. This creates a catch-up adjustment in the current generation period to correct the amount calculated by Revenue Management.
• Prospective Adjustment: Applies changes from the current date onward and distributes the remaining value over future periods.

Note:

You might observe changes in schedule lines because the schedule adapts to the revenue already recorded on the source record. We recommend basing schedules on revenue recognition to ensure data consistency for forecasting.