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NetSuite Revenue Management

Revenue management can no longer live in spreadsheets. NetSuite’s financials software simplifies the complexities of evolving revenue Key Benefits recognition mandates, no matter if a sale • Accounting teams can focus on exceptions to the policy, eliminating hours spent managing and encompasses a single performance obligation, a recording revenue, and reducing the hours/days series of obligations spanning a time period, or to close. diverse obligations in a bundle. The results enable • Comply with industry guidance and mandates the automation of revenue policy for compliance, for today and tomorrow. NetSuite Revenue real-time revenue intelligence and actionable data. Management works seamlessly with Multi-Book Accounting to account for a single transaction under multiple standards. • Analyze actual revenue impacts as well as forecasts that dynamically respond to actual postings to give an updated expected revenue picture for future periods—all with the ability to drill back into the source sales document or transaction.

www.netsuite.com Revenue Recognition • Automate Unbilled Revenue Recording – Record Sales agreements can include a combination unbilled revenue automatically by identifying of products and services (e.g. a security system revenue elements without corresponding bills, with installation and monitoring) or a series of saving time during closing. deliverables (e.g. consulting services). Whether • Support Multi-Currency Transactions – an equal amount of revenue must be recognized Ensure that fluctuations in exchange rates are at fixed intervals or different amounts must be appropriately accounted for in each period. recognized at different intervals, NetSuite Revenue • Manage Balance Sheet Accounts – Automatically Management enables you to schedule revenue to adjust contract liability (deferred revenue) and be recognized at the proper time automatically. contract asset balances based on real-time • Revenue Policy Automation – Easily manage billings and revenue data. exceptions as they arise by holding revenue, • View Financials in Real-Time – Automatically updating revenue recognition schedules or post to the general ledger from Revenue Plans— making other changes. on your schedule, as frequently as you wish. • Automate Planning – Automatically schedule • Flexible Forecasting – Provide flexible forecasting revenue to recognize in the appropriate period to accommodate revenue projection updates based on rules. Re-usable Revenue Rules govern based on real-time business events, such the triggers, the creation and commencement of as project plan updates or planned revenue a Revenue Plan associated to a sales transaction, withheld to a future period. as well as the plan duration.

© Oracle | Terms of Use and Privacy Page 2 Multiple Performance Obligations The ability to add user defined dimensions allows Contracts with multiple components delivered at a single item (or group of items) to have multiple different points in time require special attention, SSPs and meet stratification requirements. as revenue recognition depends on how and • Powerful Allocation Calculator – Leverage when each component is delivered. NetSuite’s Standalone Selling Prices to automatically robust capabilities provide configurable revenue allocate arrangement consideration across all schedules for even the most complex agreements. elements within the Arrangement—including • Flexible Revenue Contracts – Drive an agile and support for ASC 606/IFRS 15 standards. accurate view of the revenue contract. Revenue Revenue Recognition for All Industries Arrangements are containers for Revenue Companies have traditionally been required to Elements (performance obligations). Elements follow industry specific guidance for revenue have individual attributes such as Revenue Rule, generating activities relating to the licensing, revenue plan start and end dates, and revenue selling, leasing, hosting or marketing of products allocated amount. Revenue Elements can be and services. merged across linked orders or contracts, or split into multiple Arrangements, to accurately These arrangements encompass multiple represent the revenue contract regardless of how deliverables or elements: software and any the revenue source transactions are managed combination of specified or unspecified and billed. enhancements, post-contract customer support, Managing Complex Allocations services and additional licenses. Packaged software Managing revenue correctly when products and/ arrangements with multiple elements often have or services are delivered over multiple accounting different dates of delivery (i.e. product and support), periods can be challenging. Industry standards requiring accounting departments to recognize dictate how contract prices must be allocated and defer revenue amounts appropriately. ASC based on what is being delivered when. NetSuite’s 606/IFRS 15 includes similar principles with the comprehensive allocation features enable impact extending beyond the industries that have systematic compliance with ASC 606/IFRS 15. traditionally fallen under the guidance.

• Dynamic Standalone Selling Price – Define • Support Revenue Recognition Over Time – the Standalone Selling Price (SSP) as either a Recognize revenue over time based on output constant or a dynamic formula. Formulas can (e.g. units produced, hours delivered) or input be based on information within other revenue (e.g. resources consumed, costs incurred). elements—for example, an SSP for support • Support Percentage-of-Completion – Accounting based on a percentage of licenses within that Support revenue accounting for projects leveraging contract. Item Revenue Groups allow items percentage-of completion mechanisms. with identical requirements to have the same Standalone Selling Price, eliminating duplication.

© Oracle | Terms of Use and Privacy Page 3 • Support Event Driven Revenue Plans – • Book-specific Standalone Selling Prices, Revenue Align revenue recognition with event triggers— Rules, Plans and Arrangements – Automate for example the fulfillment of an item, the concurrent posting to all books as business generation of a bill against an order, or work transactions occur in real-time, versus “after the beginning on a project. A single performance fact” posting or waiting until the end of the period obligation can be associated with multiple plans to replicate data entry and post adjustments. in order to support partial fulfillments or billings. • Book-specific Foreign Currency Management – Revenue Recognition in Accordance With Enable accounting departments to use book- Multiple Accounting Standards specific functional currencies when calculating The globalization of business today is powered the general ledger impact, including the realized by several factors, including global capital and unrealized foreign currency gain/loss markets, foreign direct investment and economic amounts per transaction. interdependence. In order to report financial results • Book-specific Financial Reporting – Enable accurately within revenue recognition mandates real-time revenue visibility for any book, based on multiple accounting standards (e.g. anywhere, anytime. GAAP, IFRS), accounting departments worldwide can leverage a powerful multi-book accounting engine that can record and post revenue-related activity to all books concurrently eliminating data entry replication and manual intervention.

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