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Revenue Distribution Methods
Your revenue distribution method controls how Salesforce Billing spreads revenue over a set time period. You can set up revenue to distribute over time or at a single point in time. (Salesforce Billing Managed Package)
Required Editions
| Available in: All Salesforce Billing editions |
Your revenue distribution method defines how Salesforce Billing creates revenue schedules and the term for each schedule. A revenue recognition treatment contains a lookup to a distribution method. This structure allows you to associate several treatments, and thus several distribution methods to one order product. For example, you could have one treatment associate your revenue schedule with a standard finance book and another treatment associate your method with a deferred finance book. The schedule and transactions you create has lookups to different finance books. You could also create a distribution method for recognizing revenue based on order product term and another distribution method for tracking revenue based on invoice line term.
We’ll review some key distribution method fields here and then take a detailed look at the layout and use cases for several types of revenue schedules.
- Monthly Recognition Proration
- If your revenue transaction came from a partial period (for example, 15 days in a monthly distribution method), Salesforce Billing prorates the transaction’s amount based on this value. Currently, you can prorate based only on the number of days in the partial period.
- Type
- Choose the action that causes Salesforce Billing to create a revenue transaction. If you select Order, Salesforce Billing creates the revenue transaction when an order product activates. If you select Invoice, Salesforce Billing creates the revenue transaction when an invoice posts.
- Revenue Transaction Creation Process
- Choose whether Salesforce Billing automatically creates a revenue schedule and transaction in response to the value you defined in the Type field. If you want to create a revenue schedule on your own, set this field’s value to Manual.
- Distribution Method
- Salesforce Billing prorates Revenue Amount pricing on revenue transactions based on
the Distribution Method field.
- Monthly: Prorate the revenue amount based on the number of days in the month. For example, if your order product bills at $80 for an initial period of 01/10/20 through 01/31/20, your revenue amount will be (22/31) * 80 = $56.77.
- Full Recognition: Salesforce Billing fully recognizes all revenue for the order product or invoice line within the revenue transaction.
- Manual: When you create a revenue schedule, Salesforce Billing doesn’t run the batch process to create revenue transactions and assign them to the schedule. Instead, you must create the revenue transactions and assign them to the correct revenue schedule. You can use workflow rules and process builders to automate the manual revenue transaction creation process.
- Revenue Schedule Term Start Date and Revenue Schedule Term End Date
- These fields define when the revenue schedule starts and ends. You can pull start and end dates from the order product, invoice line, credit note, or debit note. If you choose Manual, Salesforce Billing references user-defined code to determine revenue distribution.
- Full Recognition Date
- This field defines when Salesforce Billing recognizes revenue in full. Give this field a value only if you set your distribution method to Full Recognition.
