Overview
The article details the process when Sponsored Expenditures are incurred and Contract Events are processed in PPM or Contract Events are processed in PPM Contract Management.
Essential Information
- Billing is created and Revenue is recorded in PPM up to the Contract Funding amount through the Generate Revenue schedule process.
- See below the Unbilled and Billed Accounts related to the Revenue Accounts based on Award Type.
Outline of Process
These are the Journal entries involved in the Revenue Process:
- Revenue is recognized at the Expense level for Cost Reimbursable Awards during the Billing process (in addition to sponsored projects, the Cost Reimbursable function is now available to other project types, too).
- Revenue is recognized at the Invoice level for Fixed Price/Milestone Awards during the Billing process.
- Revenue is recorded at the Fund/FinU level, in IFIS it was at BFS Revenue Index.
- For conversion, all amounts billed, both paid or unpaid were converted into new Invoices in OFC, one Invoice for cumulative billed and paid; separate Invoices for each unpaid Invoice in ISIS.
- Hence, the Revenue for those Invoices were generated in this current fiscal year.
- To ensure Revenue is not being recorded twice, a Journal was made to reverse it at the FinU level conversion, a correction file was done in January 2021 to correct misconverted amounts.
Case 1 - Cost Reimbursable Invoice
Project Number: 1018296
| Date | Action |
| 02/01/2021 | Lab supplies purchased |
| 02/08/2021 | Invoice created (including lab supplies purchased on 02/01/2021) |
| 02/08/2021 | Revenue recognized in PPM |
| 02/09/2021 | Cash received |
| 03/01/2021 | Payment applied to Invoice |
Expense Incurred - Lab supplies purchased
1. The Expense is recorded at the item level - Department Process
-
- Debit: Lab Supplies Expense
- Credit: Account Payable
Invoice Created - Including lab supplies purchased on 02/01/2021
2. The Receivable and Revenue are recognized when the Invoice is created - Central Office Process
a. Receivable recorded to the Invoice level (PPM to AR).
-
- Debit: A/R Federal Grants Billed
- Credit: A/R Federal Grants Unbilled
b. Revenue is recognized at the Expense item level (PPM to GL).
-
- Debit: A/R Federal Grants Unbilled
- Credit: Federal Grants Revenue
Cash Received
3. The payment is received and put in the Undistributed Account before being applied to the receivable (Invoice) - Central Office Process.
-
- Debit: Cash
- Credit: Undistributed Cash
Applied Payment
4. The payment is applied to the receivable from the Undistributed Account - Central Office Process.
-
- Debit: A/R Federal Grants Billed
- Credit: Undistributed Cash
Revenue Flow to the General Ledger
5. The revenue flows to the General Ledger after it is recognized in Oracle Cloud PPM on 02/08/2021.
a. It can be verified by running the General Ledger Transaction Details report in Oracle.
Case 2 - Fixed Price/Milestone Invoice
Project Number: 1031203
| Date | Action |
| 07/02/2020 | Invoice created - Per Payment Schedule stated in the agreement |
| 07/02/2020 | Revenue recognized in PPM |
| 02/22/2021 | Cash received |
| 03/01/2021 | Payment applied to Invoice |
Invoice Created
1. The Receivable and Revenue are recognized when the Invoice is created - Central Office Process
a. Revenue is recognized to the Invoice level for Fixed Price/Milestone Awards (PPM to GL).
-
- Debit: A/R Unbilled Private
- Credit: Private Contracts Revenue
b. Receivable recorded to the Invoice level (PPM to AR).
-
- Debit: A/R Adv Billed Private
- Credit: A/R Unbilled Private
Cash Received
2. The payment is received and put in the undistributed Account before being applied to the receivable (Invoice) - Central Office Process
Debit: Cash
Credit: Undistributed Cash
Applied Payment
3. The payment is applied to the receivable from the Undistributed Account - Central Office Process
Debit: A/R Adv Billed Private
Credit: Undistributed Cash
Revenue Flow to the General Ledger
4. The Revenue flows to the General Ledger after it is recognized in Oracle Cloud PPM on 07/02/2020- Central Office Process
It can be verified running the General Ledger report in Oracle.