How Project Revenue Forecasting Calculations Work

This section outlines the recognition methods used in Revenue Forecasting when running a forecast at a project level and details the revenue sources that are included in each recognition method.

For more information on the fields that store the values taken from the objects listed, see Revenue Forecast Type Fields.

Note:

Revenue Forecasting uses monthly time periods by default, so you must ensure that monthly time periods are set up for the full project duration.

Deliverable Recognition Method

Records from the objects listed in this section are included in Time and Materials projects. A revenue forecast type record is created for each month to store the values for each of these objects for use in Revenue Forecasting.

If you are using FinancialForce Revenue Management, records looking up to a Revenue Management template of type "Deliverable" that fall within the monthly time periods spanning the project duration are included, with the exception of EVA records. EVA records only need to meet the criteria listed below.

Tip:

To configure the template in Revenue Management, use the Actuals Template setting in the Revenue Management Settings custom setting. For more information, see the Revenue Management Help.

If you are not using FinancialForce Revenue Management, Revenue Forecasting looks at the Recognition Method field on a record, which must have a value of Deliverable.

If no records meet the criteria in a particular month, an empty revenue forecast type record is created.

Includes scheduled hours for the resources assigned to the project, taking into account the hours and bill rates associated with those resources.

EVA records that meet the following criteria are included:

  • The Type field in the Time Period lookup has a value of Month.
  • The assignment record in the Assignment lookup has the Billable checkbox set to true.
  • The value in the Days Variance or Hours Variance field is less than zero.
  • The time period set on the EVA falls between or overlaps the project start and end date.

Values used by Revenue Forecasting are taken from the following fields on an EVA record:

  • If the Scheduled Bill Rate is Daily Rate checkbox is set to true, the absolute value in the Days Variance field is multiplied by the value in the Scheduled Bill Rate field.
  • If the Scheduled Bill Rate is Daily Rate checkbox is set to false, the absolute value in the Hours Variance field is multiplied by the value in the Scheduled Bill Rate field.

The value in the Scheduled Revenue field on each revenue forecast type record is calculated using values taken from the monthly EVA records that fall within the same time period as the revenue forecast.

For more information about the fields on an EVA record, see Estimates Versus Actuals Fields.

Expense records that meet the following criteria are included:

  • The Approved checkbox is set to true.
  • The Billable checkbox is set to true.
  • The value in the Expense Date field falls within a monthly time period of a revenue forecast.

The Revenue Pending Recognition field on each revenue forecast type record contains the sum of the values in the Billable Amount field for all expense records in a given month.

For more information about the fields on an expense record, see Expense Entry Page Fields.

For completed milestones, milestone records that meet the following criteria are included:

  • The Approved checkbox is set to true.
  • The Exclude from Billing checkbox is set to false.
  • The value in the Actual Date field falls within a monthly time period of a revenue forecast.

The Revenue Pending Recognition field on the revenue forecast type record contains the sum of the values in the Milestone Amount field for all completed milestone records in a given month.

For scheduled milestones, milestone records that meet the following criteria are included:

  • The Approved checkbox is set to false.
  • The Exclude from Billing checkbox is set to false.
  • The value in the Target Date field falls within the monthly time period of the revenue forecast.

The Scheduled Revenue field on the revenue forecast type record contains the sum of the values in the Milestone Amount field for all scheduled milestone records in a given month.

For more information about the fields on a milestone record, see Milestone Fields.

Miscellaneous adjustment records that meet the following criteria are included:

  • The Approved checkbox is set to true.
  • The Exclude from Billing checkbox is set to false.
  • The value in the Effective Date field falls within a monthly time period of a revenue forecast.

The Revenue Pending Recognition field on the revenue forecast type record contains the sum of the values in the Amount field for all miscellaneous adjustment records within a given month.

For more information about the fields on a miscellaneous adjustment record, see Miscellaneous Adjustment Fields.

Timecard split records that meet the following criteria are included:

  • The Approved checkbox is set to true.
  • The Billable checkbox is set to true.
  • The values in the Start Date and End Date fields fall within a monthly time period of a revenue forecast.

The Revenue Pending Recognition field on the revenue forecast type record contains the sum of the Total Billable Amount for all timecard split records in a given month.

For more information about the fields on a timecard record, see Timecard Entry Fields.

% Complete Recognition Method

Milestones or projects recognized on percentage of completion are included in fixed fee forecasts. Revenue Forecasting uses timecards and schedules on assignments to calculate the following in a given month:

See below for details of the calculations used.

If there are no scheduled hours on a project or milestone, the revenue is spread evenly across all relevant months and is displayed in the Scheduled Revenue field on the revenue forecast type record.

When you run a revenue forecast for a project, the following calculation is used to work out the Total Revenue Forecast percentage for a given month:

Revenue Pending Recognition percentage + Scheduled Revenue percentage

If you are using FinancialForce Revenue Management, records looking up to a Revenue Management template of type "% Complete" that fall within the monthly time periods spanning the project start and end dates are included.

Tip:

To configure the template in Revenue Management, use the Actuals Template setting in the Revenue Management Settings custom setting. For more information, see the Revenue Management Help.

If you are not using FinancialForce Revenue Management, Revenue Forecasting looks at the Recognition Method field on a record, which must have a value of "% Complete".

A revenue forecast record is created for each month for milestones whose recognition method is set as "% Complete". This record stores the values for EVAs and timecards for use in Revenue Forecasting.

Note:

These values are rolled up into the revenue forecast type records for the corresponding project that have “% Complete: Milestone” in the Revenue Source field.

Est Vs Actuals

EVA records that meet the following criteria are included:

  • The Type field in the Time Period lookup has a value of Month.
  • The assignment record in the Assignment lookup has the Billable checkbox set to false.
  • The value in the Hours Variance field is less than zero.
Note:

If there are no EVAs within the project duration, the value in the Milestone Amount field on a milestone is spread evenly over the project duration.

The following calculation is used to work out the Scheduled Revenue percentage:

(Hours Variance / Planned Hours) * 100

To work out the Scheduled Revenue amount, the Scheduled Revenue percentage value is multiplied by the value in the Milestone Amount field on the milestone record.

Timecards

Timecard records that meet the following criteria are included:

  • The Approved checkbox is set to true.
  • The Billable checkbox is set to false.

To work out the Revenue Pending Recognition percentage, the following calculation is used:

(Sum of Timecard Hours / Planned Hours) * 100

To work out the Revenue Pending Recognition amount, the Revenue Pending Recognition percentage is multiplied by the value in the Milestone Amount field on the milestone record.

If you are using the integration with FinancialForce Revenue Management:

  • Revenue Recognized to Date = Sum of the recognized values in a given month, based on the recognition date in Revenue Management.
  • Pending Recognition = Revenue Recognized to Date value subtracted from the value on the relevant “% Complete: Milestone” record that has a revenue type of Actuals in PSA.
  • Scheduled Revenue = Value on the relevant “% Complete: Milestone” record that has a revenue type of Forecast in PSA.

For more information about the fields on a milestone record, see Milestone Fields.

A revenue forecast record is created for each month for projects whose recognition method is set as "% Complete". This record stores the values for EVAs and timecards for use in Revenue Forecasting.

Est Vs Actuals

EVA records that meet the following criteria are included:

  • The Type field in the Time Period lookup has a value of Month.
  • The assignment record in the Assignment lookup has the Billable checkbox set to false.
  • The value in the Hours Variance field is less than zero.
Note:

If there are no EVAs within the project duration, the value in the Bookings field on a project is spread evenly over the project duration.

The following calculation is used to work out the Scheduled Revenue percentage:

(Hours Variance / Estimated Hours at Completion) * 100

To work out the Scheduled Revenue amount, the Scheduled Revenue percentage value is multiplied by the value in the Bookings field on the project record.

Timecards

Timecard records that meet the following criteria are included:

  • The Approved checkbox is set to true.
  • The Billable checkbox is set to false.

To work out the Revenue Pending Recognition percentage, the following calculation is used:

(Sum of Timecard Hours / Estimated Hours at Completion) * 100

To work out the Revenue Pending Recognition amount, the Revenue Pending Recognition percentage is multiplied by the value in the Bookings field on the project record.

If you are using the integration with FinancialForce Revenue Management:

  • Revenue Recognized to Date = Sum of the recognized values in a given month, based on the recognition date in Revenue Management.
  • Pending Recognition = Revenue Recognized to Date value subtracted from the value on the relevant “% Complete: Project” record that has a revenue type of Actuals in PSA.
  • Scheduled Revenue = Value on the relevant “% Complete: Project” record that has a revenue type of Forecast in PSA.

For more information about the fields on a project record, see Project Fields.