How To Fix FARR_CONTRACT_MAIN077 - Marking performance obligation &1 as non-distinct is not permitted

SAP Error Message - Details

• Message type: E = Error

• Message class: FARR_CONTRACT_MAIN - Revenue Accounting: Contract Management

• Message number: 077

• Message text: Marking performance obligation &1 as non-distinct is not permitted

What causes this issue?

You have attempted to mark performance obligation &V1& as non-distinct.
This operation would make performance obligation &V2& non-distinct as
well. However, performance obligation &V2& is the higher-level
performance obligation of performance obligation &V3&.

System Response

The operation is terminated.

How to fix this error?

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

Procedure for System Administrators

Error message extract from SAP system. Copyright SAP SE.

Smart SAP Assistant

• What is the cause and solution for SAP error message FARR_CONTRACT_MAIN077 - Marking performance obligation &1 as non-distinct is not permitted ?

  The SAP error message FARR_CONTRACT_MAIN077 indicates that there is an issue with marking a performance obligation as non-distinct in the context of revenue recognition. This error typically arises in the SAP S/4HANA system when dealing with contracts and performance obligations under the new revenue recognition standards (IFRS 15 / ASC 606).
  Cause:
  The error occurs when the system attempts to mark a performance obligation as non-distinct, but this action is not permitted due to the following reasons:
  
  
  Contract Structure: The performance obligation may be part of a contract that does not allow for non-distinct obligations. This could be due to the nature of the goods or services being provided.
  
  
  Configuration Issues: There may be configuration settings in the SAP system that do not allow for certain performance obligations to be marked as non-distinct.
  
  
  Business Rules: The business rules defined in the system may restrict marking certain performance obligations as non-distinct based on the criteria set for distinct performance obligations.
  
  
  Solution:
  To resolve this error, you can take the following steps:
  
  
  Review the Contract: Check the details of the contract and the performance obligations defined within it. Ensure that the obligations are correctly classified as distinct or non-distinct based on the criteria outlined in the revenue recognition standards.
  
  
  Check Configuration: Review the configuration settings in the SAP system related to revenue recognition and performance obligations. Ensure that the settings align with your business processes and the requirements of the revenue recognition standards.
  
  
  Consult Documentation: Refer to SAP documentation or notes related to revenue recognition and performance obligations. This may provide insights into the specific conditions under which performance obligations can be marked as non-distinct.
  
  
  Engage with SAP Support: If the issue persists, consider reaching out to SAP support for assistance. They can provide guidance based on the specific version of SAP you are using and any known issues or patches that may be relevant.
  
  
  Training and Awareness: Ensure that the team handling contracts and revenue recognition is trained on the criteria for distinct and non-distinct performance obligations to prevent similar issues in the future.
  
  
  Related Information:
  
  Revenue Recognition Standards: Familiarize yourself with IFRS 15 and ASC 606, which provide the framework for recognizing revenue from contracts with customers.
  SAP Notes and Knowledge Base Articles: Search for relevant SAP notes that may address this specific error or provide additional context.
  Community Forums: Engage with SAP community forums or user groups where similar issues may have been discussed, and solutions shared.
  
  By following these steps, you should be able to identify the root cause of the error and implement a solution to resolve it.