Result Analysis - Revenue affecting net income/revenue surplus

[former_member195434]

Hi,

We have a WBS which has RA key of type POC. For this RA key all actual revenues shoulds be recognized as 'revenue affecting net income' (RANI).

But for some reason, revenues for some periods are not getting recognized as RANI. Instead they are flowing to revenue surplus.

RA key configuration is:

RA type: E

Profit indicator: M

Valuation basis: S

On what basis does the system determine whether a revenue is to be recognized as RANI or as revenue surplus?

Regards

[Former Member]

Hi Abhinav

"Status" of the WBS decides whether it should recognise Revenue or as Revenue Surplus or as Revenue in excess of Billing.

For each Status, relevant configurations are maintain in OKG3 (Expert Mode)

Hope its clear.

Regards

Mustafa Sakerwala

[former_member195434]

Hi Mustafa,

The WBS is in REL status and the above configuration I have mentioned -

RA type: E

Profit indicator: M

Valuation basis: S

is of REL status in OKG3. Which other field in OKG3 should be checked in particular?

The WBS is behaving normal for most of the revenue items in REL state. The RA key is set up to recoginze all actual revenue as RANI.

In OKG4, what role does the field next to Line ID play in deciding RA category?

[Former Member]

Hi Abhinav

What is the valuation method in OKG3 (Main screen)

Regards

Mustafa

[former_member195434]

Hi Mustafa,

I dont understand what you mean by valuation method in OKG3 main screen.

The RA key is marked for expert mode.

Valuation basis is S for REL status..

The status is same (REL) for the WBS for two consecutive periods. But in first period the revenue is recognized as RANI whereas in second period, the revenue is recognized as revenue surplus. We dont know the reason.

[Former Member]

Hi Abhinav

I was referring to overview screen. Refer screenshots below to check the valuation method.

Check this and let me know. Also if the status was same, then check if the valuation method is 03 (Cost Based POC).

If so, check if the Costs are reversed in the subsequent period or for the period, there is credits (Negative costs).

Alternatively check if there is any change in Plan values (both Revenue & Costs). I believe plan costs was not updated in the first period and therefore full revenue was taken as RANI. Whereas now, in subsequent period, plan costs is maintained and therefore based on updated statistics, it is recognising Revenue Surplus. Check if this is true in your case.

Regards

Mustafa

[former_member195434]

Hi Mustafa,

Valuaiton method is 01 - Revenue based method with profit realization.

We are talking only revenues here. Costs have not come into the project yet.

How do we check changes in plan values of WBS? in CJ43 I can find revenue planning maintained. But not sure how to track changes here.

Is it possible that if the actual revenue is less than planned revenue, then the system takes all actual revenue as RANI. Whereas once the actual revenue exceeds the planned revenue in CJ43, the system considers the additional revenue as revenue surplus?

[Former Member]

Hi Abhinav

Sorry for the delay.

With Valuation Method 01, you should not have revenue surplus at all. It only calculates WIP / RUC or Cost of sales according to Revenue figures(Actual v/s Plan).

My only doubt is that you have  a sales order linked to the WBS, on which (WBS) you are doing RA Analysis. In this case Plan Revenues are updated from Sales order. However if you have used CJ43 and maintained planned values lesser than the sales order value, then perhaps this could be the cause of Revenue Surplus being recognised, when Actual Revenue is now greater than the plan value set in CJ43.

Let me know if this is your case.

Also check following link for understanding the formulae for valuations using Valuation Method 01

(01) Revenue-Based Method with Profit Realization - Cost Object Controlling (CO-PC-OBJ) - SAP Librar...

Also try creating a new RA key with same valuation method (01) and enter the Expert mode and compare the configurations at REL Status.

Hope it helps

Regards