Journal entries are generated in RevRec based on the journal account mapping that you configure, including the advanced mappings; for example, if you have applied an advanced journal mapping with product type, RevRec maps your transactions with different product types to different accounts.
Journal entries can be generated in RevRec either automatically by closing the accounting period, or manually on-demand.
RevRec automatically generates journal entries when a new data job is completed, thus always containing the most updated journal entries information. For example, if you have a daily auto sync turned on for the integrated upstream systems, the journal entries are generated automatically each day when there are new transaction data synced and processed from these systems. Additionally, when an accounting period is closed, RevRec processes certain journal entries such as re-class of deferred revenue to unbilled receivable, as part of the close.
The amounts recognized in the journal entries are monthly amounts, and if the revenue recognition starts in the middle of a month, a pro-rated amount is included. For example, if a subscription order starts on the 16th of a month, RevRec creates a journal entry for 15 days of revenue recognition for that month (assuming a 30-day month).
RevRec also provides you the option to manually start the journal entry generation process. The ability to review journal entries before closing an accounting period is very useful when dealing with a more complex revenue accounting operation. You can generate the journal entries first, review and analyze the results, make data changes and rerun the journal entries if required, before closing the accounting period.
Follow the steps below to generate Journal Entries manually on your RevRec site:
Once this feature is turned on, click Accounting > Create Journals to start the journal entry process.
Select the accounting period(s) for generating the journal entries. You can select either one accounting period or multiple accounting periods as long as they are still open and are not in the future.
Click Create to kick off the journal entry process. This could take a minute or two to complete. RevRec deletes any existing journal entries for the selected period(s) and regenerates the entries for the selected period(s).
Once the process is completed, click the Journal Entry Report icon on the top left corner of the page to review the journal entry results.
You can take the required corrective actions if there are any issues in the journal entries. For example, you can update data or custom fields required for the journal account mapping, and rerun the journal process. You can repeat this as many times as you need. Note that if input data has been updated, you must reprocess the dated data first before regenerating journals.
Journal entries do not get generated automatically when you have opted for the manual generation feature.