How To Fix FARR_CONTRACT_MAIN048 - Standalone selling price of performance obligation &1 not specified

SAP Error Message - Details

• Message type: E = Error

• Message class: FARR_CONTRACT_MAIN - Revenue Accounting: Contract Management

• Message number: 048

• Message text: Standalone selling price of performance obligation &1 not specified

What causes this issue?

The standalone selling price of the performance obligation is not
specified. However, the standalone selling price is required in the
following scenario:
The performance obligation is a distinct performance obligation.
The performance obligation does not have lower-level performance
obligations (either as bill of material (BOM) components or as
non-distinct performance obligations).
The performance obligation is not marked as "Exclude from Allocation".
The performance obligation is not marked as residual (for residual price
allocation).

System Response

The system prevents the change from being saved.

How to fix this error?

You can make one of the following changes to resolve this issue:
Specify a standalone selling price.
Mark the performance obligation as "Exclude from Allocation".
Mark the performance obligation as residual.
Put the performance obligation in a structure where it has lower-level
performance obligations.

Procedure for System Administrators

The system issues an error message and will not allow you to continue with this transaction until the error is resolved.

Error message extract from SAP system. Copyright SAP SE.

Smart SAP Assistant

• What is the cause and solution for SAP error message FARR_CONTRACT_MAIN048 - Standalone selling price of performance obligation &1 not specified ?

  The SAP error message FARR_CONTRACT_MAIN048 indicates that the standalone selling price for a performance obligation is not specified in the system. This error typically arises in the context of revenue recognition and contract management, particularly when dealing with performance obligations in contracts.
  Cause:
  The error occurs when:
  
  A performance obligation is defined in a contract, but the standalone selling price (SSP) for that obligation has not been maintained.
  The system requires the SSP to calculate revenue recognition correctly according to accounting standards (e.g., IFRS 15 or ASC 606).
  The performance obligation is part of a contract that is being processed for revenue recognition, but the necessary pricing information is missing.
  
  Solution:
  To resolve this error, you can take the following steps:
  
  
  Maintain Standalone Selling Price:
  
  Navigate to the relevant contract in the SAP system.
  Identify the performance obligation that is causing the error.
  Enter the standalone selling price for that performance obligation. This can usually be done in the contract management or revenue recognition module.
  
  
  
  Check Contract Configuration:
  
  Ensure that the contract is configured correctly to include all necessary pricing information.
  Review the settings for performance obligations to ensure they are set up to allow for standalone selling prices.
  
  
  
  Review Pricing Procedures:
  
  Check if the pricing procedure used in the contract allows for the entry of standalone selling prices.
  If necessary, adjust the pricing procedure to include SSP.
  
  
  
  Consult Documentation:
  
  Refer to SAP documentation or help resources for specific instructions on how to maintain standalone selling prices in your version of SAP.
  
  
  
  Testing:
  
  After entering the SSP, reprocess the contract to see if the error persists.
  Ensure that all related performance obligations have their SSPs maintained.
  
  
  
  Related Information:
  
  Performance Obligations: These are promises in a contract to transfer a good or service to a customer. Each performance obligation must have a standalone selling price for proper revenue recognition.
  Standalone Selling Price (SSP): This is the price at which an entity would sell a promised good or service separately to a customer. It is crucial for allocating transaction prices to performance obligations.
  Revenue Recognition Standards: Familiarize yourself with the relevant accounting standards (IFRS 15 or ASC 606) that govern how revenue should be recognized based on performance obligations and their standalone selling prices.
  
  If the issue persists after following these steps, it may be beneficial to consult with your SAP support team or a functional consultant who specializes in SAP revenue recognition and contract management.