ANS-1222 · REVENUE RECOGNITION
Can NetSuite Revenue Arrangements Be Updated to Reflect New Sales Accounts?
Understand why changes to item-level accounts do not automatically propagate to existing revenue arrangements and their associated journal entries.
Short answer
No, NetSuite does not automatically update the recognition or deferral accounts for existing revenue arrangements. Even if the associated item's sales account is changed, the accounting treatment for a created revenue arrangement remains fixed. Subsequent changes to item-level accounts will not impact previously generated arrangements or their associated journal entries.
Scenario
A user attempts to modify the sales or target account associated with an item. They then expect these changes to automatically or manually update existing revenue arrangements linked to that item. However, despite these efforts, the system continues to post revenue recognition and deferral journals to the original accounts.
Solution
NetSuite's functionality dictates that existing revenue arrangements do not automatically update their recognition or deferral accounts based on changes made to the associated item's account. This behavior has been confirmed through testing and is consistent with NetSuite's design for revenue management.
Observations from testing indicate:
Changing the account at the item level does not alter the accounts used by existing revenue arrangements.
Both automatic and manual updates to revenue arrangements fail to change the recognition or deferral accounts.
Reviewing screens such as Revenue Arrangements, Journal Entry, Revenue Element, and Revenue Plan confirms that journals continue to post to the original recognition and deferral accounts.
This behavior is documented by NetSuite, stating that automatic and manual updates to revenue arrangements will not change the recognition account. For further details, refer to:
https://netsuite.custhelp.com/app/answers/detail/a_id/49236/kw/update%20existing%20revenue%20arrangementsExpert NetSuite Support
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