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NSC | Use of a Discount Item in ARM changed the Revenue Recognition Rule for the transaction

edited Aug 5, 2025 11:54PM in Accounting / ERP

Scenario:

The user encountered an issue with using discount in their revenue recognition process. Normally, revenue is recognized when an order is fulfilled. However, when a discounted item is added to an order, the system changes the revenue recognition rule for the entire order, causing revenue to be recognized at the time of billing instead. Their consultant suggested creating new non-inventory items for these discounts as a solution. They want to confirm if this adjustment in the system's behavior is standard and expected.

Solution:

As per SAID: 49183 | Revenue Recognition Rules:

When the source transaction includes a posting discount, all elements in a revenue arrangement use Default One-Time Direct Posting rule.

Clarisa De Torres | Ask a Guru

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