How do I reverse revenue when it is included journal with additional customer revenue recognition?

Question

Hello

Patrick Fresnosa-Oracle

I see your suggestion to void the journal entry in this thread but I see it is "Answered" so logging here separately. (If you tell me which is the appropriate place to pose the question? I will delete the other.)

In my case, the revenue recognition is included in a journal entry with other revenue schedule recognition so voiding the journal entry is not an option.

I am looking for a way to reverse the revenue recognition for a specific Invoice (2 revenue schedules) in prior closed periods. I will re-open the periods but do not want to effect all the other revenue schedules in prior periods (it's way too risky). I have deleted the journal entry in the "current" periods before to reverse the revenue.

Our Items are service. We don't leverage return authorizations. Our business model does not require ARM so we are using the "Revenue Recognition" feature to produce revenue schedules.

Do you have another suggestion?

The highlighted revenue recognition lines are the ones I need to reverse & would hope not to have to effect all the other lines.

Thanks

CDuf · Accepted Answer

I created a Credit Memo with the original Invoice date to create the related Revenue Schedule & can process separately for each month. This is the likely solution.

A quick background on why I complicated the issue.

We erroneously merged 2 customers with different reporting attributes and, as we know this is not reversible.  Luckily the merged customer only had one opportunity, estimate/quote, Sales Order, invoice, payment, deposit.

I was hunting a way to manually move this set of transactions to a new replacement Customer and retain the original Document #'s.

You will only be interested in the following, if you ever do the same thing... it's a long process.

These are the steps I used (in Sandbox first) because we wanted to retain the original Document #'s(we cannot retain the original Internal Id's on most transactions), if anyone needs this:

Create a replacement Customer.

Ran "before" reports for later validation.

During a scheduled time, re-opened the related periods.

Set NetSuite to allow override at Setup>Company>Setup Tasks>Auto-Generated Numbers, if original #’s are necessary on

·        Customer

·        Opportunity

·        Deposit

·        Journal

·        Quotation

·        Sales Order

Before getting started, change every existing Document #'s (keep track of them) so the original # is available for use below. (We have some # gaps so I selected "missing" Document #'s for each.)

CUSTOMER

Navigate to Lists>Relationships>Customers> New and uncheck the “Auto” field next to the Customer ID field.

Enter the Customer # 230183 and remaining necessary fields to create the replacement Customer

CONTACT

Navigate to Lists>Relationships>Contacts and select Mark McKee by clicking the Edit link.

Update the Company (top middle of screen) to 230183, access the Relationships tab and Remove Company 197162 then use the Relationships>Company drop list to select 230183

OPPORTUNITY

Navigate to the surviving Customer Access & Edit Opportunity 1926. Select Customer 230183 and Save. This will re-assign the Opportunity to the replacement Customer.

QUOTE

Access & Edit Quote 3311. Select Customer 230183, validate the Date remains the Schedule date of 9/13/2023, Save. This will re-assign the Quote 3311 to the Replacement Customer. This should retain the link to the Opportunity 1926.

Validate the executed Schedule is on Quote 3311 on the Communications>Files tab.

Use the attached Schedule to validate the Quote addresses are on the Quote 3311.

Click the Quote, Opportunity hyperlink and validate Opportunity 1926 opens.

SALES ORDER

Return to the Quote 3311 and Validate the Customer/Project is 230183 click the Sales Order button to create the Sales Order on Customer

Update the Sales Order, Order # field to 2658 and the Sales Order date to 09/14/2023. The Created From field, will contain a hyperlink to Quote #3311, Save.

Review the Sales Order for accuracy, update as normally appropriate.

Status = Pending Approval because the Quote did not go through a workflow when moved to Replacement Customer

Navigate to Transactions>Sales>Approve Sales Orders and select Order # 2658, click Submit to change the Status to Pending Billing

INVOICE

Return to the Sales Order 2658 and click the Bill Remaining button to create the Invoice.

Update the Invoice # to 2042960 and the Invoice date to 09/14/2023.

Validate the Posting Period is Sep 2023 and the Customer is 230183, Save

This will create the Revenue schedules that will be used to create the revenue recognition journal entries for the Replacement Customer during a later step.

PAYMENT & APPLICATION

While in the Invoice # 2042960, click the blue Accept Payment button at the top of the screen.

Update the Payment # to 3682457 and the date to 10/10/2023.

Validate the Posting Period is Oct 2023 and the Replacement Customer is 230183.

Select the Payment Option on the Payment Method tab and click on Wire Transfer.

Click on the Apply tab and validate the amount is correct in the Payment Amount field.

Select by clicking Apply on the Invoice # 2042961 and validate the amount in the Payment field is also correct

DEPOSIT

Navigate to Transactions>Bank> Make Deposits

Update the Deposit # to 4000 and the date to 10/10/2023.

Validate the Posting Period is Oct 2023.

Select the Account 1042.

See the Deposits tab and Payments subtab, Select checkbox for the Payment Number 3682457.

Validate the amount is correct and the From is the Replacement Customer. Save

REVENUE RECOGNITION

Credit Memo to reverse merged revenue already recognized.

On the original Invoice (now re-numbered) on the surviving Customer, create a Credit and date it the same date as the original Invoice date. This will create credit revenue schedules that begin in the same period as the original invoice.

Be sure to Unapply the Credit Memo from the Invoice (for now).

Navigate to Transactions>Financial>Create Revenue Recognition Journal Entries and complete select the Posting Period = Nov 2023

Validate Journal Entry Date is 11/30/2023

Select Original Customer: Project = 197162

Confirm the Select Individual Schedules box is checked

Select the re-numbered original Invoice #

Invoice

Navigate to Transactions>Financial>Create Revenue Recognition Journal Entries and complete select the Posting Period = Nov 2023

Validate Journal Entry Date is 11/30/2023

Select Replacement Customer: Project = 230183

Confirm the Select Individual Schedules box is checked

Select Invoice # 204296

Clean up original (now re-numbered) documents

Delete the Deposit, Remove the Application, Delete the Payment so the Original Invoice is Open.

Apply the new Credit Memo to the Original (now re-numbered)

Much Simpler Option

If you do NOT care about historical reporting or original document #'s you could create a $0.00 Invoice on the Replacement Customer in the current period with the same Items as the original invoice just to reflect the attributes, items purchased & therefore entitled to service.

Lesson: When you are warned that a merge is irreversible, pause & re-examine what you are about to do.... Don't just click!... We all know that but this is the first time in 13 years... 😏

If the administrator thinks this is way too obscure or flawed, feel free to delete.

Patrick Fresnosa-Oracle · Accepted Answer

Hello @CDuf,

Thanks for the details!

Unfortunately, voiding a particular portion in a Journal entry is not allowed and also when you generate a Revenue Recognition Journal Entry, it is a system limitation to edit, or removed the fields since these are ran through the system via Schedule Revenue Recognition > Run Now such limitation is filed under enhancement 129662 Rev. Rec./Amortization: be able to edit the lines on journal entries created by the revenue recognition schedules.

Apologies for this system limitation.