SAP BRIM
SAP BRIM and RAR Integration: How Revenue Flows
How subscription and usage data from SAP BRIM reaches SAP Revenue Accounting and Reporting, and the key design decisions for ASC 606 and IFRS 15 compliance.
SAP Billing and Revenue Innovation Management (BRIM) handles subscriptions, usage rating, invoicing, and receivables at high volume. But billing is not revenue. For ASC 606 and IFRS 15, companies need SAP Revenue Accounting and Reporting (RAR) – and a well-designed integration between the two.
Why the Integration Matters
Subscription and usage-based models create typical revenue accounting challenges:
upfront or periodic billing that differs from service delivery,
bundles of equipment, subscriptions, and usage,
minimum commitments and included volumes,
frequent contract changes,
very high transaction volumes.
BRIM manages the commercial and billing side. RAR applies the accounting rules. The integration determines whether revenue is complete, correct, and traceable.
The Flow of Information
At a high level, three types of information flow from BRIM to RAR:
1. Contract information
From subscription order management: what the customer has subscribed to, for which period, and at which price. This becomes the basis for revenue accounting contracts and performance obligations.
2. Fulfillment information
Evidence that the service was provided – time-based for subscriptions, or event-based for usage.
3. Billing information
Invoiced amounts from Convergent Invoicing, which are compared with recognized revenue to determine contract assets and liabilities.
Each flow must be designed so that RAR can link the information to the correct contract and performance obligation.
Key Design Decisions
Contract Granularity
What is a revenue accounting contract in a subscription business? Options include one per subscription, per customer agreement, or per bundle. The choice affects allocation, performance, and reporting.
Performance Obligations
Which elements are distinct? Typical candidates are the subscription itself, included usage, additional usage, equipment, installation, and support.
Treatment of Usage
Usage-based fees are often variable consideration. Depending on the facts, they may be allocated entirely to the period in which usage occurs, or companies may use the "right to invoice" practical expedient. This decision determines whether usage needs to be transferred to RAR in detail or can be handled in a simplified way.
Volume and Aggregation
Transferring every single usage event to RAR is rarely necessary or efficient. Aggregation rules must balance performance with the level of detail required for revenue accounting and audit.
Contract Changes
Upgrades, downgrades, renewals, and cancellations must be transferred to RAR so that modifications are recognized correctly – prospectively or cumulatively, depending on the nature of the change.
Receivables and Postings
FI-CA posts receivables and billing; RAR posts revenue and contract balances. Account determination and clearing logic must be aligned to avoid double counting.
Reconciliation
With several components involved, reconciliation is essential:
subscriptions in order management vs. contracts in RAR,
rated and billed amounts vs. invoice information in RAR,
FI-CA postings vs. general ledger,
RAR postings vs. general ledger.
Reconciliation should be designed during the project, not after go-live.
Common Pitfalls
Designing billing first and adding revenue accounting later.
Transferring too much detail to RAR, causing performance issues.
Transferring too little detail, making allocation or audit impossible.
Not aligning contract identifiers across components.
Underestimating the volume of contract changes.
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The Bottom Line
The integration between SAP BRIM and RAR is where subscription billing becomes compliant revenue accounting. The key decisions – contract granularity, performance obligations, usage treatment, and aggregation – should be made jointly by finance and IT, early in the project.
Integrating SAP BRIM with revenue accounting? Talk to our experts.
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