Projects > [Name of project] > Recognition Recognition Rules | Run Recognition/Transactions | Auto-run The revenue recognition feature allows you to set up rules for recognizing revenue on a project-by-project basis. It must be noted that if you want to recognize revenue generated from your project billing rules, you do not need to reiterate the rules here. For example, if you have set up a fixed fee billing rule for a project and you want to recognize this revenue, you do not need to create a fixed amount recognition rule. Since the fixed fee will be turned into a timebill, you simply need to create an "As billed" recognition rule to recognize this and other revenue generated by the project billing rules. RECOGNITION RULES Create | Modify/Delete There are several types of recognition rule: % complete, As billed, Expenses, Fixed amount on date or milestone, Fixed amount on % complete, Purchases, and Incurred vs. Forecast. % complete rule: The "% complete" rule will recognize a portion of a fixed amount each time revenue recognition is run for a project or phase of a project, based on either the "% complete" status of the phase/project, the proportion of approved hours to planned hours, or the proportion of approved hours to budgeted hours (which are entered in the "New/Edit Project" dialog box). As billed rule: This rule will recognize the revenue from all timebills that fall within the date range that you specify. The date range is optional. Expenses rule: There are several ways in which you can recognize revenue from expenses: you can recognize the markup/markdowns on receipts that have been billed to clients, you can recognize all billed expenses as revenue, or you can recognize all incurred (both billed and billable/approved) expenses. Note that these methods of recognizing revenue from expenses are mutually exclusive. Therefore you can only create one expenses rule per project. Recognition can be limited to particular expense items or users in the Filters section of the recognition rule configuration. Fixed amount on date or milestone rule: You recognize a fixed amount of revenue on a specific date or milestone, or even a repeating fixed amount for a project. You can specify different types of fixed amounts in each rule (revenue, cost, or other), and associate them with different accounting codes. Fixed amount on % complete rule: You recognize a fixed amount of revenue when the project as a whole, or a particular phase, reaches a specified percentage of completion. When the percentage complete meets or exceeds the designated threshold, a revenue recognition transaction will be generated. You can specify different types of fixed amounts in each rule (revenue, cost, or other), and associate them with different accounting codes. Purchases rule: There two ways in which you can recognize revenue from purchases: you can recognize the markup/markdowns on purchases that have been billed to clients or you can recognize all billed purchases as revenue. Note that these methods of recognizing revenue from expenses are mutually exclusive. Therefore you can only create one purchases rule per project. Incurred vs. forecast rule: This method recognizes revenue based on how the project is tracking against the ingoing plan, specifically by dividing the incurred costs by the forecast costs and then multiplying by the amount of revenue to be recognized. Incurred and forecast costs can include any combination of labor, expenses, and purchases. To create a recognition rule: 1. Click on the Projects tab. 2. Click on the project name in the list. 3. Click on the "Recognition" link. 4. Click on the "Recognition rules" link. 5. Select the type of rule you want to create from the "Create..." drop-down list box. 6. Create the rule by setting its parameters. The recognition rule fields are explained below: Recognition fields: Amount: Used for "% complete" and "incurred vs. forecast" rules. Enter the total amount to be recognized (i.e. the amount that will be recognized once the project is 100% complete). Currency: If you have enabled multi-currency functionality, select the currency in which you want the rule to be created. Calculate using: Used with "% complete" rules. The choices are: "% complete of the planned hours," "Approved hours vs. planned hours," and "Approved hours vs. budget hours." Date range: Used for "As billed" rules. If needed, enter a start and end date during which time the rule will be in effect. If milestones have been created for the project, you will be able to select one of these milestones rather than a date, if desired. Revenue to recognize: Used with expenses rules and Purchases rules. For expenses select whether to recognize only the markup/markdown amount of billed receipts, all billed expenses, or all incurred (both billed and billable/approved) expenses. For purchases select whether to recognize only the markup/markdown amount of billed purchases or all billed purchases. Amount and Date: Used with fixed amount rules. Enter the amount for the fixed amount, and the date on which it should be recognized. If milestones have been created for the project, you will be able to select one of these milestones rather than a date, if desired. Recognition rule filters: Limit the recognition rule to specific users and expense items. Click Create/Edit to select expense items and users for which revenue will be recognized. Repeat recognition rule: Used with fixed amount rules. You can create a rule with a repeating fixed amount. For example, if you wanted to recognize a certain amount every month that you have received from a client for work on a project, you could set up a fixed amount rule that will recognize the same amount every month. Click on the ">Create:" button to create a repeating fixed amount. In the "Repeat" pop-up dialog box, select the frequency and the interval for the amount. (The "Repeat Every" interval will change to reflect the frequency selected.) Select an end date for the repeat amount or designate a specific number of repetitions. Click "OK." Incurred costs: Used with incurred vs. forecast rule. You can select which items (labor, expenses, and purchases) to include in the numerator when calculating the incurred versus forecast costs. Forecast costs: Used with incurred vs. forecast rule. You can select which items (labor, expenses, and purchases) to include in the denominator when calculating the incurred versus forecast costs. Accounting code: You can associate particular types of recognition with an accounting code. This code is used for the export of revenue information to your accounting system. Name: You can give the rule a name. If you do not, a default name will be assigned. The default name has the following format: "[type] recognition rule [#]". For example, if you create a "% complete" rule, it might be, "% complete recognition rule 1." Notes: Enter any notes, if desired. Active recognition rule: Uncheck this box if you want to deactivate this rule. 7. Click on "Save" or "Save & create another recognition rule." To modify or delete a recognition rule: 1. Click on the Projects tab. 2. Click on the project name in the list. 3. Click on the "Recognition" link. 4. Click on the "Recognition rules" link. 5. Click on the name of the rule that you want to modify. Make your changes and then click on "Save." To delete a rule, click on "Delete." Note: You cannot delete a recognition rule that has associated recognition transactions. RUN RECOGNITION (and RECOGNITION TRANSACTIONS) When you run recognition, a list of potential recognition transactions, based on the rules you have set up for the project, will be displayed. From this list, you can select the items you wish to turn into transactions. Once you do, click on the "Recognition transactions" link to see a list of your transactions. Note: You must create at least one rule for the project before you can run recognition. To run recognition: 1. Click on the Projects tab. 2. Click on the project name in the list. 3. Click on the "Recognition" link, and then on the "Run recognition" sub-link. 4. If desired, enter a start and end date for the revenue recognition run. (These dates default to the values you entered when you last ran revenue recognition for any project.) Click "Next". 5. The list of available revenue items will appear. If no revenue is available, you will see the message that says, "No recognition transactions are pending for this project." 6. If needed, you can edit the items in the list. Click on the date of the revenue item you want to change. Make your changes in the dialog box, and then click on "Save." 7. Select the items that you want to turn into revenue recognition transactions by enabling the check boxes. 8. Click on the "Create recognition transactions." You can now click on the "Recognition transactions" link to see the items that have been recorded as transactions. You can edit recognition transactions on this page as well. Once you have created recognition transactions for a project, revenue information will be displayed on the financial analysis report of the project. Note: If you want to rerun recognition, click the "Click here" link at the bottom of the page. This will give you the option of entering a new set of dates. AUTO-RUN There are three options for automatically running revenue recognition on a timed basis. The first is the default, "Do not auto-bill". The second is, "Run recognition, do not create recognition transaction," which lets you test the recognition run without actually creating revenue items. The third is, "Run recognition and create recognition transaction," which lets you perform a recognition run that does create revenue items. To access the auto-run options: 1. Click on the Projects tab. 2. Click on the project name in the list. 3. Click on the "Recognition" link, and then on the "Auto-run" sub-link. This brings up a dialog box with three radio buttons indicating the options. To run trial automatic revenue recognition: 1. Select the "Run recognition, do not create ..." option from the "Auto-run" dialog box. 2. Select the users who should receive the results of the trial run in an e-mail message by clicking on the ">Create" or ">Edit" button, selecting the users from the "Available items" list, and clicking the "Add highlighted items >" button to move them to the "Selected items" list. 3. Select the day and the time of the week that the trial recognition will run. The e-mail messages with the results will be sent as soon as the trial has been run. Note: Times are in Eastern Time (GMT-05:00) 4. There is an option to suppress recognition notification emails if no transactions are recognizable. Administrators can select this option by going to Recognition > Auto-bill. In the Email settings section, check the box to suppress the email if nothing is recognizable. 5. Click on "Save." To run actual automatic revenue recognition: 1. Select the "Run recognition and create ..." option from the "Auto-run" dialog box. 2. Select the users who should receive the results of the run in an e-mail message by clicking on the ">Create" or ">Edit" button, selecting the users from the "Available items" list, and clicking the "Add highlighted items >" button to move them to the "Selected items" list. 3. Select the day and the time of the week that the event will run. The e-mail messages with the results will be sent as soon as the trial has been run. Note: Times are in Eastern Time (GMT-05:00) 4. There is an option to suppress recognition notification emails if no transactions are recognizable. Administrators can select this option by going to Recognition > Auto-bill. In the Email settings section, check the box to suppress the email if nothing is recognizable. 5. Click on "Save."