How To Fix FARR_CONTRACT_MAIN810 - Time-based perf. oblig. &1 must not have rights of return

SAP Error Message - Details

• Message type: E = Error

• Message class: FARR_CONTRACT_MAIN - Revenue Accounting: Contract Management

• Message number: 810

• Message text: Time-based perf. oblig. &1 must not have rights of return

Self-Explanatory Message

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Smart SAP Assistant

• What is the cause and solution for SAP error message FARR_CONTRACT_MAIN810 - Time-based perf. oblig. &1 must not have rights of return ?

  The SAP error message FARR_CONTRACT_MAIN810 indicates that there is an issue with a time-based performance obligation in a contract, specifically that it must not have rights of return. This error typically arises in the context of contract management and revenue recognition processes within SAP, particularly when dealing with performance obligations in contracts.
  Cause:
  The error is triggered when:
  
  A time-based performance obligation is defined in a contract, but it is incorrectly configured to allow rights of return.
  The system expects that time-based performance obligations should not have any rights of return associated with them, as this could lead to complications in revenue recognition and reporting.
  
  Solution:
  To resolve this error, you can take the following steps:
  
  
  Review the Contract Configuration:
  
  Check the specific contract that is causing the error. Look for the performance obligation that is marked as time-based.
  Ensure that the configuration of this performance obligation does not include rights of return.
  
  
  
  Modify the Performance Obligation:
  
  If the performance obligation is indeed time-based, you may need to remove any rights of return associated with it. This can typically be done in the contract management module of SAP.
  If rights of return are necessary for your business process, consider whether the performance obligation should be redefined as a different type that allows for such rights.
  
  
  
  Consult Documentation:
  
  Refer to SAP documentation or your organization's internal guidelines regarding performance obligations and rights of return to ensure compliance with accounting standards and business practices.
  
  
  
  Testing:
  
  After making the necessary changes, test the contract again to ensure that the error no longer appears and that the contract behaves as expected in terms of revenue recognition.
  
  
  
  Seek Help from SAP Support:
  
  If you are unable to resolve the issue, consider reaching out to SAP support or your internal SAP team for further assistance. They may provide insights specific to your system configuration or version.
  
  
  
  Related Information:
  
  Performance Obligations: These are commitments in a contract to transfer goods or services to a customer. They are crucial for revenue recognition under accounting standards such as IFRS 15 and ASC 606.
  Rights of Return: This refers to the ability of customers to return products. In the context of performance obligations, having rights of return can complicate revenue recognition, as it introduces uncertainty about whether the performance obligation has been satisfied.
  SAP Modules: This error is typically encountered in modules related to contract management, revenue recognition, and financial accounting.
  
  By following these steps, you should be able to address the FARR_CONTRACT_MAIN810 error effectively.