Issue/Symptom/Question

How do you process a Revenue Recognition process in PENTA?

Applies To

PENTA for Windows → Finance & Accounting → Processing → Revenue Recognition

Resolution/Fix/Answer

A revenue recognition process is initiated at a balance sheet OU level. PENTA performs a revenue recognition (WIP) calculation for all jobs assigned to the entered OU as well as jobs assigned to organizations that fall underneath the balance sheet OU (this includes child balance sheet organization units). The revenue recognition method used to calculate earned revenue is determined by the revenue recognition method assigned to individual jobs.

• Revenue Recogn. as of date - enter the date you want PENTA to perform the revenue recognition process for. 
• Last Period Close was - display field only, PENTA displays the last accounting period end date that has been through the Period Close process for the entered Balance Sheet OU Id
• Last Revenue Recogn. was - display field only, PENTA displays the last "as of date" that a revenue recognition process was performed for the entered Balance Sheet OU Id
• Next Period Close is for - display field only, PENTA displays the period end date for the next accounting period to be closed for the entered Balance Sheet OU Id
• Perform 'One Time Percent Complete' Recognition of Cost and Revenue for Completed Contract Jobs Y/N - PENTA posts all costs and billings to balance sheet work in process accounts and only recognizes these costs and revenues on the income statement when the job closes. An entry of "Y" to this question instructs PENTA to perform  percentage of completion revenue recognition calculation on jobs that have an open status. This is typically performed at the end of a fiscal year when the costs and billings on these jobs need to be recognized.
  • Use the Limit 'One Time Percent Complete' by Job Type button at the bottom of the window to restrict this calculation to jobs in one or more Job Types
• Calculate earned to date for 'Manual revenue recognition only' jobs Y/N - in PENTA jobs can be setup so that they're excluded from PENTA's automated revenue recognition process, for these jobs earned revenue is accomplished via the entry of manual revenue recognition entries. An entry of "Y" to this question instructs PENTA to perform an automated revenue recognition calculation for these jobs using the revenue recognition rule assigned to the jobs. If manual revenue recognition entries exist for these jobs for the period in which revenue recognition is being run, PENTA will continue to use those values in lieu of the automated calculation.
• Automatically reverse entire revenue recognition process Y/N - PENTA always reverses the revenue accrual created for cost plus contract line items each time a revenue recognition process is performed. An entry of "Y" to this question instructs PENTA to create reversing entries for lump sum and unit price contract line item accruals in addition to the reversing entries for cost plus line items.
  • Use the Limit 'Manual Revenue Recognition Only' Calculation By Job Type  button at the bottom of the window to restrict this calculation to jobs in one or more Job Types

Exiting the window initiates the revenue recognition calculation process. PENTA displays several messages as it steps through the calculation. When the process is complete the window closes and PENTA returns to the PENTA Navigator. To review the results use the Job WIP Report that exists in the PENTA Workbench in the PM: Project Management Reporting center.