Revenue Report

An important concept to understand is the difference between a sale, and the revenue generated by that sale. Whilst the Sales report will show all sales that occurred on a particular day, the Revenue report is designed to give you an overview of how much of those sales represent Revenue from an accounting perspective.

The main point to keep in mind is the treatment of Voucher and Course sales. When you sell a Voucher to a client you are creating a future obligation to provide services or goods at a future date. The sale of the Voucher will reflect in your daily Sales report for the value the voucher was sold at.

In the future, when the Client redeems this voucher for a service the sale of the Service will also show on your Sales report. To avoid counting this sale twice, the Revenue report provides an alternative method for viewing actual Revenue earned over a period.

The Revenue report gives you an overview of this by allowing you to calculate what revenue you generated based on IAS and IFRS guidelines. This states that the sale of vouchers or courses should only reflect as revenue when they are redeemed.

When you tick the Calculate Accounting Revenue option, revenue is calculated by taking total sales, less tax, less voucher and course sales, plus any course redemptions. Voucher redemptions are not explicitly added back as they would already be included in the total sales figures.

Because different business owners refer to the concept of revenue differently, the Revenue report also gives the option to be run without ticking the Calculate Accounting Revenue option. When the report is run like this, revenue is simply calculated as total sales less any used vouchers. Running the report like this is useful if you want an idea of what you earned for a given day, regardless of what future obligations have been created.

Summary of calculations:

  • Calculate Accounting Revenue Ticked: Total Sales - Tax - Vouchers Sold - Courses Sold + Courses Redeemed.
  • Unticked: Total Sales - Vouchers Redeemed

 

 

 

 

Have more questions? Submit a request

0 Comments

Please sign in to leave a comment.
Powered by Zendesk