Revenue Generation

Because Vantagepoint is an accrual-based system, you can use the revenue generation process to recognize project revenue as it is earned (rather than when payment is received) and match it to expenses as they are incurred (rather than when expenses are paid).

To get an accurate view of a project's financial status, it is important to match revenues with amounts spent. If you do not use the revenue generation process, Vantagepoint recognizes revenue as it is billed.

When you run Revenue Generation, it calculates revenue by WBS (project/phase/task) based on the revenue method that is assigned to a project on the Accounting tab in the Projects hub. It calculates JTD revenue less Prior JTD revenue to create a journal entry to post. Project and general ledger reports are updated with the revenue amounts.

When you run revenue generation:

You can choose a standard revenue method or define your own methods to calculate job-to-date (JTD) revenue for each of your projects. If you select the most appropriate revenue method for each project based on the project's contract type, you can improve the accuracy of your reports and financial statements.
A project’s job-to-date revenue is calculated as the sum of the revenue that is calculated at the project’s lowest work breakdown structure (WBS) level. For example, if a project has phases and tasks, the project's revenue is calculated as the sum of the revenue that is calculated for each of its tasks.
Each project's unbilled services revenue is posted to the project, and you do not need to create separate journal entry transactions.
Each project's data is updated and used to generate financial statements.

You can run revenue generation only for projects whose charge type is regular. You cannot use it with overhead or promotional projects. You set the charge type for a project on the Accounting tab of the Projects form in the Projects hub.

Setting Up Revenue Generation

When you set up the revenue generation feature, you choose whether or not to:

Use revenue categories to track multiple unbilled services and uninvoiced revenue accounts.
Use revenue groups to recognize revenue at the group or contract level multiple projects in a contract or group.
Set up overall revenue upset limits that restrict the job-to-date revenue that is recognized for a project.
Set up an overall revenue calculation at the project level to calculate job-to-date revenue.

Alternative: Consultant Accruals

If your company's vendor or consultant expenses are significant, consider using consultant accruals. Revenue generation calculates accrued revenue, and consultant accruals calculates accrued expense to match that revenue. The consultant accruals feature also provides you with consultant-related reports.

Timing

Because the revenue generation process calculates revenue on a job-to-date basis, you can run it whenever you want (multiple times during the same accounting period, if necessary). To keep your project reports accurate and up-to-date, you should run revenue generation at least once a month or at the end of each accounting period.

To see current period revenue, run revenue generation and then subtract the prior job-to-date revenue from the new job-to-date revenue.

Multiple Companies

If you use multiple companies, you enable and set up revenue generation options individually for each company in your enterprise. For each company, you evaluate Vantagepoint's revenue methods, upset limit, revenue group, and revenue categories features and determine whether and how to set them up to most suitably recognize, track, and report project revenue for that company. You also run the revenue generation process separately for each company.

See the Concepts help for information on how job-to-date revenue is calculated when you have an overall revenue calculation for a project, and the project's phases or tasks belong to different companies.

Multiple Currencies

If you use multiple currencies, all the phases or tasks for a project must have the same currency.