Steps: Set Up Deferred Billable Project Costs Accounting

Create and approve a billable project.

You can set up deferred billable project costs accounting to relieve work-in-progress amounts and record them as costs of sales. When you recognize revenue on a project, Workday automatically creates secondary journal entries associated with expense report and supplier invoice transactions for a billable project. When the billable project on the customer contract line has a revenue treatment of:

Accrued
or Deferred
, Workday recognizes revenue and creates secondary journal entries at the time of revenue recognition accounting.

Invoice
, Workday recognizes revenue and creates secondary journal entries at the time of invoicing.

Set Up Project Billing Configurations.

Select these check boxes:

Enable Deferred Billable Project Costs Accounting

I understand that I can't disable deferred billable project costs accounting once it's enabled

Set Up Account Posting Rules.

For the spend account posting rule, configure these options:

Resulting Ledger Account	Dimension	Values
Asset	Accounting Treatment	Deferred Project Cost
Cost	Accounting Treatment	Cost of Sales
Cost	Revenue Category

(Optional) Assign Company Accounting Details.

You can configure Workday to post Billable Project Cost Recognition journals using either the accounting date or the invoice approval date. Select Customer Invoice
from 1 of these prompts:

Allow Accounting in Arrears

to post journals at the time of invoicing using the accounting date.

Allow Accounting by Approval Date

to post journals using the invoice approval date.

Create Customer Contracts.

Workday uses the revenue category on the customer contract line to debit the cost of sales ledger account.

Create Expense Reports.

On the expense report lines, select:

A billable project, project phase, or project task from the

Worktags

prompt.

The

Billable

check box.

Create Supplier Invoices.

On the supplier invoice lines, select:

A billable project, project phase, or project task from the

Worktags

prompt.

The

Billable

check box.

Create Consolidated Billing Schedules for Customer Contracts.

Create Revenue Recognition Schedules for Customer Contracts.

Create Customer Invoices from Contracts.

Create Revenue Installments for Billable Transactions.

Access the

Create Revenue Recognition Accounting

task.

Configure the Revenue Recognition Installment Event
business process and security policy in the Customer Contracts and Project Billing functional areas.

Workday creates a Billable Project Cost Recognition operational journal using the spend account posting rule.

Concept: Revenue Recognition Accounting