Revenue Generation Overview

Because Vision is an accrual-based system, you can use Vision's Revenue Generation 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. Without Revenue Generation, Vision recognizes revenue as it is billed.

When you use Revenue Generation, you can choose one of Vision's standard revenue methods 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.

When you run Revenue Generation, a project’s JTD 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.

When you use Revenue Generation, each project's unbilled services revenue is posted to the project, and you do not need to create separate journal entry transactions. Revenue Generation also updates each project's data and uses it to generate financial statements.

When you enable Revenue Generation, 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 JTD revenue that is recognized for a project.

  • Set up an overall revenue calculation at the project level to calculate JTD revenue.

You can run Revenue Generation only for projects whose charge type is regular. You cannot use it with overhead or promotional projects. The charge type for a project is set up on the Accounting tab of the Project Info Center.

If your company's vendor or consultant expenses are significant, consider using Vision's Consultant Accruals feature. Consultant Accruals works best for projects that use Revenue Generation. 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 Revenue Generation 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.

Multicompany

If you use Multicompany, you enable and set up Vision's Revenue Generation options individually for each company in your enterprise. For each company, you evaluate Vision'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 Revenue Generation separately for each company.

See the discussion of Revenue Generation and Multicompany in 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.

Multicurrency

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

Related Topics:

  • Checklist: Setting Up Revenue Generation
    If you are new to Vision, you may find it helpful to review a list of the general steps that you complete to set up Revenue Generation.
  • Revenue Categories Overview
    When you enable the Revenue Generation feature, you have the option to track one or multiple unbilled services, uninvoiced revenue, and fee billed revenue accounts using revenue categories.
  • Overall Revenue Upset Limits Overview
    With Vision's Revenue Generation feature, you have the option to set up an overall upset limit that applies a maximum limit on the job-to-date (JTD) revenue that can be recognized for a project when you run Revenue Generation.
  • Overall Revenue Calculation for a Project
    For individual projects, you can set up an additional overall revenue calculation at the project level.
  • Revenue Groups Overview
    For projects that are part of a group or contract, you can use revenue groups to recognize revenue at the overall group (contract) level, rather than as the sum of its lowest WBS parts.
  • Running Revenue Generation
    Run the Revenue Generation procedure a minimum of once per accounting period.
  • Revenue Generation Reporting Overview
    Use Revenue Generation reports to view all of the revenue methods that are defined in your Vision database and the data from Revenue Generation transactions.
  • Contracts and Revenue Generation
    The methods most appropriate for revenue generation depend on contract type.
  • Frequently Asked Questions for Revenue Generation
    If you are new to using revenue generation in Vision, you may find it helpful to review frequently asked questions.
Parent Topic: Accounting Overview