Skip to main content
Documentation
Documentation
Administrator Guide
Last Updated: 2025-03-14
Setup Considerations: Multiple-Element Revenue Allocation

Setup Considerations: Multiple-Element Revenue Allocation

You can use this topic to help make decisions when planning your configuration and use of multiple-element revenue allocation. It explains:
  • Why to set it up.
  • How it fits into the rest of Workday.
  • Downstream impacts and cross-product interactions.
  • Security requirements and business process configurations.
  • Questions and limitations to consider before implementation.
Refer to detailed task instructions for full configuration details.

What It Is

Multiple-element revenue allocation enables you to allocate revenue on customer contracts with multiple performance obligations.

Business Benefits

Multiple-element revenue allocation reduces manual effort and helps to ensure that you report recognized revenue in compliance with:
  • ASC 606 accounting standards.
  • IFRS 15 accounting standards.

Use Cases

Use multiple-element revenue allocation to meet reporting requirements when the revenue line amount on the customer contract differs from the contract line amount.

Questions to Consider

Questions
Considerations
When you do your pricing studies, how do you determine the fair value price for your sales items?
When your company sells items based on:
  • A percentage of the list price or a discount from the list price, you can configure your fair value price list using a percentage.
  • The average selling price over a period of time, you can configure your fair value price list using an amount.
How do you want to allocate revenue for a single customer contract?
To calculate revenue allocation:
  • Automatically, configure fair value price lists for each sales item or sales item group on a customer contract line. Workday applies the fair value to each line and allocates revenue when you enable multiple-element revenue allocation on the customer contract.
  • Manually, specify fair value and revenue allocation amounts for each sales item on a customer contract line.
How do you allocate revenue among multiple customer contracts?
Enable at least 1 customer contract type for linked contracts. You can then associate multiple customer contracts with a single parent contract and allocate revenue among them.
What volume of your customer contracts need multiple-element revenue allocation?
To allocate revenue for:
  • A single customer contract, you can create multiple-element revenue allocation from the related actions menu of an approved customer contract. This method enables you to update range percentages, fair value pricing, revenue override amounts, and exclude lines from the calculation.
  • Multiple customer contracts, you can run multiple-element revenue allocation in mass using a report.

Recommendations

Features
Considerations
Lower and Upper Range Percentages
When you don't create a fair value price list, Workday recommends that you calculate revenue based on a percentage of the sales price.
Allocation Basis
Workday recommends that you use an allocation basis to calculate the relative selling price allocation for each sales item on a customer contract line.
Do Not Auto-Allocate Revenue
When you have a large number of customer contract lines that you want to allocate revenue for, Workday recommends that you:
  • Enable this option in your revenue allocation configurations.
  • Run allocations in mass using a report.
Revenue Allocated
When you create multiple-element revenue allocation outside of Workday, we recommend that you enable this check box to indicate that you've already allocated revenue for the customer contract.

Requirements

You must:
  • Create sales items that use an accrued or deferred revenue treatment for use in a fair value price list.
  • Manually enter revenue override amounts for sales item bundles on customer contract lines.

Limitations

Features
Considerations
Sales Items and Sales Item Groups
You can only:
  • Assign sales items to 1 sales item group when the sales item group has a group type of fair value pricing.
  • Include sales item groups that have a group type of fair value pricing in a fair value price list.
Variable Customer Contract Lines
Workday doesn't support these variable customer contract lines with multiple-element revenue allocation:
  • Fixed Fee Project
  • Prepaid
  • Project Time and Expense
  • Usage-Based
  • Variable Amount Non-Project
  • Value-Based Project
Projects
Workday doesn't support Time and Material projects with multiple-element revenue allocation.

Tenant Setup

To define tenant-wide and company-wide configurations, access the
Set Up Revenue Allocation Configuration
 task. You can use the task to configure how Workday allocates revenue on customer contracts with multiple-element arrangements.

Security

Domains
Considerations
Process: Customer Contract - View
 in the Customer Contracts and Project Billing functional areas.
Report on multiple-element revenue allocation.
Process: Revenue - Allocations
 in the Customer Contracts and Project Billing functional areas.
Create multiple-element revenue allocation for approved customer contracts.
Set Up: Customer Contracts - Price Lists
 in the Customer Contracts and Project Billing functional areas.
Maintain and view fair value price lists.
Set Up: Revenue - Allocations
 in the Customer Contracts and Project Billing functional areas.
  • Create, edit, maintain, and view fair value price lists.
  • Set up revenue allocation configurations.
Set Up: Sale Item
 in the Customer Accounts and Learning Core functional areas.
Create and edit sales items.
View: Sale Item
 in the Customer Accounts and Learning Core functional areas.
Report on sales items.

Business Processes

Business Processes
Considerations
Customer Contract Event
Create and approve customer contracts with multiple-element revenue allocation.
Revenue Recognition Schedule Event
Review and approve revenue override amounts from multiple-element revenue allocations.

Reporting

Reports or Dashboards
Considerations
Carve In/Out
 report
View multiple-element revenue allocations on your customer contracts.
Fair Value Allocation
 report
View multiple-element revenue allocations completed for a company.
Fair Value Analysis
 report
View customer contract lines that fall within the allocation threshold for your tenant.
Maintain Fair Value Price List
 report
View and edit fair value price lists.
Run Multiple-Element Revenue Allocation
 report
Run allocations for available customer contracts.
Revenue dashboard
Use this dashboard to access tasks and reports related to multiple-element revenue allocation.
You can use these report data sources to create custom reports:
  • Customer Contracts
  • Customer Contracts Lines
  • Revenue Recognition Schedules

Integrations

Web Services
Considerations
Get Customer Contracts
Retrieves customer contracts with multiple-element revenue allocation enabled.
Get Multiple-Element Revenue Allocations
Put Multiple-Element Revenue Allocation
Retrieves multiple-element revenue allocations for customer contracts.
Creates and updates multiple-element revenue allocations for customer contracts.
Get Revenue Allocation Configurations
Put Revenue Allocation Configuration
Retrieves the current revenue allocation configurations in your tenant.
Creates and updates revenue allocation configurations.
Get Sales Items
Put Sales Item
Retrieves all the sales items in your tenant.
Creates and updates sales items
Get Sales Item Fair Value Price Lists
Put Sales Item Fair Value Price List
Retrieves the fair value price list associated with a sales item.
Creates and updates fair value price lists.
Submit Customer Contract
Submits customer contracts with multiple-element revenue allocation enabled.

Connections and Touchpoints

Features
Considerations
Customer Contracts
Specify revenue override amounts on customer contract lines.
Workday applies the revenue override amounts to the amounts on your revenue recognition schedule.
Financial Accounting
Create revenue recognition operational journals for multiple-element arrangements.
Workday offers a Touchpoints Kit with resources to help you understand configuration relationships in your tenant. Learn more about the Workday Touchpoints Kit on Workday Community.