How To Fix FARR_MSG_CUSTOM035 - Time-based performance obligation &1 cannot have open revenue

SAP Error Message - Details

• Message type: E = Error

• Message class: FARR_MSG_CUSTOM - Customizable Messages for Revenue Accounting

• Message number: 035

• Message text: Time-based performance obligation &1 cannot have open revenue

What causes this issue?

Time-based performance obligation cannot have open revenue.

System Response

During Initial Load, a time-based POB is created that has:
An End-date that is not initial and occurs before the transfer date
An allocated amount that is greater or less than the recognized revenue
from the legacy system
For the POB, no additional revenue is recognized by Revenue Accounting.
As the end date is earlier than the transfer date, Revenue Accounting
does not know how to recognize the delta revenue between allocated
amount and recognized revenue from the legacy system.

How to fix this error?

This message can be customized in the message control Customizing
setting. The system responds depending on whether the status of this
message is set to Warning or Error.
Warning: This scenario is reported as a warning. Please be aware that
the system cannot automatically handle the inconsistent data. You need
to manually guarantee the delta revenue amount that will be passed to
revenue accounting yourself.
Error: The system will prevent this inconsistent data from being saved.
Therefore, contract creation will fail.

Procedure for System Administrators

Example 1: For a time-based POB, the contractual price is 100 EUR, and a
credit memo with a value of -20 EUR occurs in the legacy system.
Therefore, revenue of 80 EUR is recognized in the legacy system.
While processing initial load, the allocated amount of 100 EUR and the
recognized revenue of 80 EUR is passed to revenue accounting to generate
a contract. If the end date is earlier than the transfer date, the
message is set to Warning.
Afterwards, when processing the invoice RAI item of the credit memo, the
allocated amount is adjusted to 80 EUR.
Example 2: For a time-based POB, the contractual price is 100 EUR. There
is no revenue posted in the legacy system, and the POB has been rejected
in the legacy system.
When processing initial load, the allocated amount of 100 EUR and
recognized revenue of 0 EUR is passed to revenue accounting to generate
a contract. If the end date is earlier than the transfer date, the
message cannot be set to Warning as there is no further event to change
the allocated amount or recognize the revenue.

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_MSG_CUSTOM035 - Time-based performance obligation &1 cannot have open revenue ?

  The SAP error message FARR_MSG_CUSTOM035 indicates that there is an issue with a time-based performance obligation in the context of revenue recognition. Specifically, it states that the performance obligation identified by the placeholder &1 cannot have open revenue. This typically occurs in the context of SAP's Revenue Accounting and Reporting (RAR) module, which is used for managing revenue recognition in compliance with accounting standards.
  Cause:
  
  Open Revenue Entries: The performance obligation has open revenue entries that need to be addressed before any further processing can occur.
  Incorrect Status: The status of the performance obligation may not be set correctly, indicating that it is still active or has not been fully recognized.
  Configuration Issues: There may be configuration settings in the RAR module that are not aligned with the business processes or accounting standards being followed.
  Data Integrity Issues: There could be inconsistencies or errors in the data related to the performance obligation, such as missing or incorrect entries.
  
  Solution:
  
  Review Open Revenue: Check the performance obligation for any open revenue entries. You may need to recognize or clear these entries before proceeding.
  Update Status: Ensure that the status of the performance obligation is updated correctly. If it has been fulfilled, it should be marked as completed or recognized.
  Check Configuration: Review the configuration settings in the RAR module to ensure they align with your business processes and accounting standards. This may involve consulting with your SAP configuration team or a functional consultant.
  Data Validation: Validate the data associated with the performance obligation to ensure there are no inconsistencies or errors. This may involve checking related documents, contracts, or entries in the system.
  Consult Documentation: Refer to SAP documentation or notes related to the error message for additional guidance and troubleshooting steps.
  
  Related Information:
  
  SAP Notes: Check for any relevant SAP Notes that may provide additional insights or patches related to this error message.
  Transaction Codes: Familiarize yourself with relevant transaction codes in SAP RAR, such as FARR for revenue recognition, to help navigate and troubleshoot the issue.
  User Roles: Ensure that the user has the appropriate roles and authorizations to perform actions related to revenue recognition and performance obligations.
  Testing: If changes are made, conduct thorough testing in a development or quality assurance environment before applying changes to the production system.
  
  If the issue persists after following these steps, it may be beneficial to engage with SAP support or a consultant who specializes in SAP RAR for further assistance.