GAAP revenue recognition

  • 22 September 2020
  • 6 replies

How to automatically update project current margin estimate that equals total revenue budget minus total cost budget divided by total revenue budget?

6 replies

Userlevel 1



Our VP of Product Management put out a great article on how to set up Project Account and Revenue Recognition.

Thank you for the article David.

More to the point, how does Acumatica 2020R1 (or a future release) support GAAP construction revenue recognition including:

1) Having revenue at the project level and costs at the task level so that a project-level profit margin can be utilized in allocation rule formulas

2) Auto-adjusting recognized revenue for a project based on a change to the project-level profit margin by adjusting the recognized revenue/costs in excess that has been allocated from expenses to match the current profit margin.

3) Automatically move dollars between Billings in Excess of Costs and Costs in Excess Billings. For example and vice versa, Billings in Excess of Costs should never have a debit balance. The dollar amount that made that account within a project go to a debit balance should be automatically moved to Costs in Excess Billings.

Thank you,

Dave Z

Userlevel 1



Our Projects team has put out a webinar on Revenue Recognition on Projects.


It can be seen here. 



The answers posted above only address part of the question.  i.e. Revenue.

Based on my understanding and many weeks of working with PM, you can recognize Revenue or you can recognize Costs, but you cannot recognize both.  So it fails the GAAP requirement to recognize profitability.

Back a few years ago, it used to have a concept of WIP (costs), that it would allow you to post costs at time of invoicing.  There used to be a field on the billing rules for the WIP Accounting Group.  This got moved to the Tasks, but its no longer functional, plus it limited to just one account group, so it was barely functional.

It makes a lot of business sense as well as being GAAP compliant.  I guess it must be a bit complex, but hey, that what ERP systems are meant to handle.

I hope my understanding is incorrect, and someone would advise me how to recognize both revenue and costs simultaneously and then perform the appropriate posting at Invoicing.

We have found issues with expenses being greater than expected and then revenue being recognized at over 100%  Is there a way to stop revenue recognition to go over 100%

Thank you for the questions.

The billing rule still allows you to bill the WIP account group or any account group if using Time and Expense.  The Non-Billable WIP Account Group on the task is for Progress Billing purposes and the details can be found here-


There is not a way to stop revenue recognition from going over 100% at this time.  This is a great idea and others have asked before, please add to the Ideas section for future consideration.



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