Accrue Revenue on T&M project with Billing Rule

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When the progress billing rules are used on a Time and Materials project where Hours, Expense and Item are set to go to P&L and the 'Accrue revenue' checkbox is checked for Hours, Expense, Item and Fee and the Line property is also set to accrue revenue, still the revenue cannot be accrued. With use of progress billing rule on the time and materials project, there is no way one can accrue the revenue. The reason i am asking this is, if during the month end there is no billing and the user wishes to accrue the revenue to match the cost posted, system does not allow with the setup i mentioned above along with billing rule. The problem with this kind of behavior is the costs are posted to PNL but the revenue cannot be accrued, if there is no billing at the month end.

Has anyone encountered such a scenario and if yes, how was the issue resolved?

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Ludwig Reinhard Microsoft Employee on at

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Hi Sarang Kusare,

If you have activated the accrued revenue parameters in the project group form then AX should automatically accrue the prospective revenue at the time the costs are posted. You don't need a billing rule for that purpose.

Can you possibly share your project group setup and provide some additional details - possibly an example - of what your system posts and what you expect?

Best regards,

Ludwig

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André Arnaud de Cal... 300,896 Super User 2025 Season 2 on at

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Hi Sarang,

A small addition from my opinion: Normal invoicing on transaction base can do accrued revenue. When you are using billing rules, the accrued revenue is ignored as it doesn't know which exact transactions are related to that invoice.

You would need to do accruals manually or consider other settings/invoicing mechanism. Can you elaborate on the cost recording and billing rules? Have you also looked at fixed price projects?

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Community Member on at

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Thanks for the reply Dr.Ludwig. The issue is, because of the customization that we are attempting, we are using Billing Rules in our solution. So in this case billing rule will be used, no doubt about that, as our solution is based on progress billing rules on TandM project. However the bigger question is how to accrue revenue when the progress billing rule is used with TandM kind of a project where Hours, Expense and Item are set to go to P&L and the 'Accrue revenue' checkbox is checked for Hours, Expense, Item and Fee and the Line property is also set to accrue revenue??

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Hello André Arnaud de Calavon, Thanks for the reply.

Our solution is based on TandM projects with progress billing rule. Hence we are not thinking of Fixed price projects for this solution. When you say we need to accrue manually, can you please suggest how do we do it? Because no matter what, with billing rules in place accruals cannot be posted.

If manual accruals are done at the GL level then the Project Sub-ledger is not impacted and that is not advisable.

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Ludwig Reinhard Microsoft Employee on at

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Hi,

Can you describe a bit more about the customization you plan to implement?

I am especially interested on the way how you plan to post cost and revenues. Can you describe the voucher transactions you expect at least exemplarily?

Best regards,

Ludwig

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Community Member on at

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Hi Ludwig,

The plan is to use progress billing rules on TandM project and also have the ability to accrue the revenue, which is a justifiable ask.

All the costs on the TandM project group are set to go to PNL.

Postings should be like this:

Cost postings:

Dr Project Cost

Cr Payroll allocation (Hours) / Employee Vendor (Expenses) / Vendor (Item)

Revenue postings: (when the project invoice is posted)

Dr Accounts receivable

Cr WIP account (BS account)

System should now give the ability to accrue the revenue:

Dr WIP account (BS account)

Cr Accrued Revenue (PNL account)

This accrual is not possible in standard AX.

Kind Regards

Sarang

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Ludwig Reinhard Microsoft Employee on at

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Hi Sarang,

Regarding the accrued revenue posting you are right that the standard application can't do this posting in the way you described it above.

However, have you tried using the accrued revenue costs parameters that can be setup at the project group level? It will create accruals that are posted at the time you record the hour/item/expense transactions and it will be based on the sales price of those transactions. Maybe that is an alternative for you?

Another option would be using a fixed-price project. Through the estimate functionality you can achieve the revenue accrual posting that you describe above out of the box.

Best regards,

Ludwig

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