General Process

Revenue recognition data that resides in the legacy system must be transferred to the new Revenue Accounting system. This data migration also involves a shift in the accounting method for revenue recognition. Therefore, it is necessary that historical accounting data can be explained by the old accounting method and that accounting data occurring after the migration can be explained by the new accounting method. Transactions that occur after the migration are based on historical data before the migration. Therefore, you must make sure that no more revenue postings are made to accounting periods before the migration. One way of ensuring this is to close all periods pre-dating the migration.

Timing of the Migration

The new revenue accounting method is effective on a specific date, known as the takeover date. As of the takeover date, your company uses the new revenue accounting method for revenue recognition. The revenue accounting data after the migration is based on the revenue accounting data before the migration. Therefore, the actual migration can start sometime after the takeover date, when no more revenue postings are made to the old accounting periods.

As the migration cannot occur until after the takeover date, it must treat documents that are posted before and after the takeover date differently. Documents that are posted before the takeover date are posted by the legacy system. Even though these documents are transferred to Revenue Accounting, they must not trigger further postings. However, the data in these documents forms the basis for further (delta) revenue calculation. Documents that are posted after the takeover date but prior to the actual migration must be handled by the new Revenue Accounting system as if the new accounting system had been active when this document was posted.