Enabling the Advanced Revenue Management (Essentials) Feature

When you enable Advanced Revenue Management (Essentials), NetSuite automatically adds the following system accounts:

• Deferred Revenue – for contract liabilities

• Deferred Revenue Clearing

• Unbilled Receivable – for contract assets (This account already exists if you have previously enabled the Revenue Commitments feature.)

• Revenue Arrangement (a non-posting account)

The Advanced Revenue Management (ARM) in Configuration Mode feature is automatically enabled when you enable ARM (Essentials). You cannot use ARM features to recognize revenue when ARM in Configuration Mode is enabled. ARM in Configuration Mode lets you continue using your previous revenue recognition processes while configuring ARM. For more information about ARM in Configuration Mode, see Advanced Revenue Management in Configuration Mode.

If you disable ARM (Essentials) while ARM in Configuration Mode is enabled, then ARM in Configuration Mode is automatically disabled. Disabling ARM (Essentials) while ARM in Configuration Mode is enabled deletes all your configurations for ARM (Essentials), including its default system accounts. You cannot disable ARM (Essentials) if there is a balance on any of its default system accounts.

If you use the Automated Intercompany Management feature, NetSuite automatically checks the Eliminate Intercompany Transactions box on the system deferred revenue and unbilled receivable accounts. This enables the automatic generation of elimination journal entries for intercompany sales. For more information, see Automated Intercompany Management Overview.

When the ARM (Essentials) feature is enabled and the ARM in Configuration Mode feature is disabled, revenue for all items is deferred until revenue recognition journal entries are created. Item records use the system–generated deferred revenue account and the Default Standard revenue recognition rule by default. You must select a value for the Create Revenue Plans On field on the item record to finish item configuration. For more information, see the following topics:

• Revenue Recognition Rules

• Item Configuration for Advanced Revenue Management (Essentials) and (Revenue Allocation)

• Disabling the Advanced Revenue Management in Configuration Mode Feature

• Generating Advanced Revenue Recognition Journal Entries

The NetSuite order-to-revenue workflow begins with the sales order or invoice, and specifically includes these transactions:

• Sales order

• Invoice

• Cash sale

• Return authorization

• Credit memo

• Cash refund

If you have been using classic revenue recognition, order-to-revenue workflows begun before you enabled the ARM (Essentials) feature continue to use classic revenue recognition. Any new order-to-revenue workflows will use Advanced Revenue Management (Essentials) after disabling ARM in Configuration Mode. For details, see Revenue Recognition and Advanced Revenue Management (Essentials).

To use ARM (Essentials), the Accounting Periods feature must be enabled because accounting periods are used for revenue recognition plans.

Watch the following video to learn how to enable the ARM (Essentials) feature.

After you have enabled ARM (Essentials), you can enable the related feature, Rule-Based Recognition Treatment. For information about this feature, see Rule-Based Recognition Treatment.

General Notices