To Configure a Package for IFRS 15/ASC 606

You use the Non-Stock Items (IN202500) or Stock Items (IN202000) form to configure a package for use in adherence with the following standards:
  • The International Financial Reporting Standard (IFRS) 15—generally referred to as IFRS 15
  • The 606 Revenue from Contracts with Customers Generally Accepted Accounting Principles (GAAP) standard—generally referred to as ASC 606

Based on these standards, the revenue of each item is recognized in proportion to the fair value price of each item within the package.

Before You Proceed

Before you configure the package, make sure of the following:

  • The Revenue Recognition by IFRS 15/ASC 606 feature has been enabled on the Enable/Disable Features (CS100000) form.
  • All required deferral codes designed for configuring packages have been created in the system on the Deferral Codes (DR202000) form. For details, see Managing Recognition for Packages.
  • All required items (stock items or non-stock items) to be included in the package have been created in the system on the Non-Stock Items (IN202500) or Stock Items (IN202000) form.
  • All stock or non-stock items that are included in the package have fair value prices configured on the Sales Prices (AR202000) form.

To Create a Package Based on Fair Value Prices

  1. Open the Non-Stock Items (IN202000) form.
  2. On the form toolbar, click Add New Record to create a new non-stock item. For details, see Non-Stock Item: Implementation Activity.
  3. On the Deferral tab, in the Deferral Code box, select a deferral code that has been created in your system for configuring multiple-deliverable arrangements.
    Note:
    For this code, the Multiple-Deliverable Arrangement check box must be selected on the Deferral Codes (DR202000) form.
  4. In the Revenue Components table of the tab, do the following for each item to be added to the package:
    1. On the table toolbar, click Add Row.
    2. In the Inventory ID column of this row, select the item (by its identifier) that should be included in the package.
    3. In the Quantity column, specify the number of this item that is included in the package.
    4. In the Deferral Code column, select the deferral code, which defines the conditions for deferring this item.
  5. On the form toolbar, click Save.

Notes About the Procedure

The notes in this section describe the nuances of the UI elements available on the form, such as when an element is required and when it is not, and when the system fills in settings by default. This section can include other notes.

Note the following about the Deferral tab:
  • With the Revenue Recognition by IFRS 15/ASC 606 feature enabled on the Enable/Disable Features (CS100000) form, the Default Term, Default Term UOM, Allocation Method, Fixed Amount, and Percentage columns become unavailable.
  • The settings you enter on this tab, together with the configured fair value prices, will be a source of the reallocation pool calculations shown on the Reallocation Pool tab of the Deferral Schedule (DR201500) form for an automatic deferral schedule that the system creates for an invoice with this package.