One of Oracle NetSuite’s key features is its ability to be customized fully to match a user’s need or a specific business requirement.
In a typical instance of NetSuite without the Advanced Revenue Management (ARM) module, revenue is recognized upon an approved invoice.
However, each company will recognize revenue differently based on numerous factors, and recognizing revenue upon invoicing may not be feasible and will have a big impact on financials if this is a system limitation.
How does NetSuite adapt to businesses with different Revenue Recognition triggers? The answer: Advanced Revenue Management.
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How does Advanced Revenue Management work?
Revenue Rule
Revenue Rules determine how and when revenue is recognized for a particular item. The rule created will also identify:
- The time-period revenue is recognized
- The impact of modifying an end date change
- Recognition method
NetSuite allows the user to create as many rules as needed for their business. Once the rule has been created, the items will be associated with the revenue rule that applies to it.
Revenue Arrangements
Standalone transactions (i.e. transactions created on their own) created by the Order to Cash process will have an associated Revenue Arrangement. The Revenue Arrangement is a separate transaction record designed to manage the total revenue of the associated transaction.
Revenue Elements
Revenue Elements are part of the Revenue Arrangements and are displayed as line items that were sold to the customer. The revenue elements will contain all the details required for revenue recognition and also identify the revenue rule.
Revenue Plans
Based on the details identified in the Revenue Element and Revenue Rule, a Revenue Plan will create a schedule of revenue to be recognized over the configured time-period. From this record, users will have the ability to:
- Modify Revenue recognition start/end dates
- Ability to pause an ongoing revenue schedule
- Directly modify the revenue recognition to be recognized
Why Choose GURUS to Implement NetSuite ARM
NetSuite Advanced Revenue Management module is a powerful solution that can help you manage your complex revenue streams and comply with the latest accounting standards. However, implementing this module can be challenging and time-consuming without the right partner.
That’s why you should choose GURUS Solutions, a leading NetSuite partner that has the experience, expertise, and tools to help you succeed with NetSuite's advanced revenue management. Whether you need implementation, customization, integration, or support, GURUS Solutions can provide you with the best NetSuite services and solutions.
Contact a NetSuite specialist today for a FREE 30-minute consultation and see how GURUS can help you transform your revenue management with NetSuite.
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