Oracle’s Initial Response to Topic 606 & IFRS 15, Revenue from Contracts with Customers Stephen Thompson, KPMG Seamus Moran, Oracle Financials Development.

Oracle’s Initial Response to Topic 606 & IFRS 15, Revenue from Contracts with Customers
Stephen Thompson, KPMG Seamus Moran, Oracle Financials Development

Content Steve Thompson will discuss compliance with the standard and issues in transitioning to it. Seamus Moran will discuss Oracle’s product response Fusion Revenue Management Fusion & eBusiness Suite Peoplesoft Contracts JD Edwards Contracts

The New US GAAP and IFRS Revenue Recognition Standard
Stephen Thompson

NEW REVENUE RECOGNITION RULES
Replaces all current rules, including industry and transaction-specific standards Converges US GAAP and IFRS revenue recognition practices Principles-based standard will require more judgment in reaching conclusions Greater use of estimates Complex transition requirements O 2018 2016 2013 2014 2017 2015 January 1st Retrospective transition application date Effective date May 28, 2014 Final standard Effective date for public entities with December 31 year ends. Nonpublic entities have a one year deferral in effective date.

NEW REVENUE RECOGNITION RULES, NOT ONLY A CHALLENGE BUT ALSO AN OPPORTUNITY…
Sweeping changes in the way revenue is recognized by companies… New information requirements requiring significant system and process changes… Opportunity to reevaluate accounting policies, processes, systems and technology …to achieve improvement in all aspects of the revenue cycle, drive efficiencies and increase value add to the business… Accounting Changes Opportunity to achieve improvement in all aspects of the revenue cycle to drive efficiencies and increase value add to the business… 1. New revenue standard Financial and Operations Process Changes Revenue Recognition Automation and ERP Upgrades Governance and Change

BROAD-BASED ORGANIZATIONAL IMPACT
For many companies, implementation of the new revenue recognition standard is more than an accounting exercise, as many different groups will need to be involved. Business Impact on business practices Budget and management reporting Communication with financial markets Covenant compliance Opportunity to rethink business practice Coordination with other strategic initiatives Systems and Processes Impact on ERP system General ledger, subledgers and reporting packages Supporting transition process New processes SOX compliance Change Management Project management Impact on internal resources Training (accounting, sales, etc.) Revenue change management team Multi-national locations Accounting, Tax, and Reporting Accounting policies Historical results and transition Reporting differences Disclosure of expected impact Tax reporting Tax planning Revenue Recognition Many of us have seen this slide before – but it highlight an important point. The people, processes and systems that either support…or are affected by…the revenue recognition cycle span throughout an organization. Therefore for many companies, the implementation of the new revenue standard will involve not just accounting and financial reporting resources, but also other groups throughout the organization. On the next few slides I will highlight a few of these areas.

EXAMPLE REVENUE RECOGNITION CHANGES
Existing Standards New Standard 100+ sources for revenue guidance 1 standard for all arrangements, all industries Must have “persuasive evidence” of arrangement Must have “legally binding” arrangement Fees must be fixed & determinable Fees are estimated if sufficient history exists No recognition of contingent revenue No similar prohibition; subject to estimation Unit of account based on “standalone value” Unit of account based on “distinct” No rules on accounting for modifications Modification rules can result in complicated acctg. Software industry held to higher standard (“VSOE”) Software guidance eliminated IP license recognized upfront or ratable based on practice IP license subject to specific rules on how to recognize Capitalizing contract acquisition costs optional Capitalizing contract acquisition costs required Revenue disclosures limited to policy discussion Extensive disclosures required

CHOICE OF TRANSITION METHOD IMPACTS IMPLEMENTATION
2012 and prior 2013 2014 2015 2016 2017 2018 and beyond Cumulative Effect Method Evaluate Existing Contracts for Cumulative Effect Adjustment Overall message – Transition requirements GREATLY complicate the implementation effort. This slide includes transitions – when in presentation mode must be advanced to add effects There are many reasons why a company might choose either the cumulative effect method or the retrospective method of adoption. Each company will need to consider its specific circumstances when making that decision. What I want to focus on today is the implications that those different methods of adoption may have on your implementation plan. To start, let’s take a look at the cumulative effect method of adoption. In the timeline on this slide we are assuming a 1/1/17 effective date. 1ST TRANSITION Now the first thing that jumps out at you is the top row – reflected in pink – which illustrates the fact that calculating the cumulative effect will require companies to review historical accounting. For companies with longer term customer contracts, with deliverables being fulfilled over a period of time – perhaps multiple years – the population of contracts that are open as of the effective date may be larger, and may require a longer “look back” into historical periods in order to analyze the change in revenue under the new standard. On the slide we have represented this effort as roughly 2 ½ years, but in actuality the timeline will vary for each company. This slide also illustrates in the second row that new systems and processes that enable the determination of revenue under the new standard will be required to be in place no later than the effective date. 2ND TRANSITION Finally, the third row – in green – illustrates that the existing systems and process for legacy GAAP reporting will continue not just through the effective date…but all the way through the end of 2017 (again, for a calendar year company). This dual reporting capability is necessary because the new standard will require a company to disclose – on a line by line basis – the impact of the new standard on its financial statements during the first year of adoption. Now let’s contrast those requirements with the retrospective transition method. Under this method, on the effective date companies will begin reporting results for 2017 under the new standard, and also report prior periods as if the new standard had been applied during those periods. 3RD TRANSITION This results in a dual reporting requirements for 2015 and This can be satisfied either by implementing a real-time dual reporting capability, or an effort after the fact to go back and calculate revenue under the new method. Most companies who desire to adopt retrospectively, and which face significant differences under the new standard, may want to implement their new reporting capability as soon as possible in order to avoid having to go back and recalculate revenue for 2015 and 2016 after the fact. The timing of when this dual reporting capability goes live will depend on individual facts and circumstances. In many cases, the extent of process and system changes may delay the new reporting capability to a later date. Nonetheless, most of the companies we have been speaking with that are leaning towards a retrospective approach desire to have the dual reporting capability in place as soon as possible. 4th TRANSITION The dotted line reflects the fact that even under the retrospective method, during 2017 there will be requirement to disclose significant ways in which the “new” revenue recognition differs from “legacy” GAAP. This disclosure won’t be as in-depth as required under the cumulative effect method, but nonetheless may require some companies to maintain dual reporting capability through the first year of adoption. 5TH TRANSITION The next thing that jumps out at you is the fact that – like the cumulative effect method – a cumulative effect calculation still needs to be performed under the retrospective method. The difference is in timing – as it is performed as of the beginning of the retrospective period. The extent to which historical periods need to be considered will depend on how far back open contracts extend 6th TRANSITION Finally, I wanted to point out that the retrospective method of adoption could be complicated by the SEC’s 5 year reporting requirement under Regulation S-K. Unless the SEC provides an exception from its rule, then companies would need to apply the new standard to 2014 and 2013 in order to retrospectively adopt over the entire 5 year period. b) Conclusion – What does this mean as you plan for implementation? Well without the option of adopting the standard prospectively – as we have had on most new revenue standards in the past – the implementation of this standard will become more complicated. Many companies I have been speaking with that expect significant changes to result from the standard are intrigued by the ability to adopt retrospectively. As you can see, the choice of transition method could impact the timing of your implementation – and influence your implementation strategy. So Companies will need to decide on their transition method early in the process. In addition, an early start to implementation will allow dual reporting capabilities to be introduced sooner, reducing the extent to which historical periods need to be reexamined. Dual reporting capability Maintain New Systems and Processes Maintain Existing Systems and Processes for Legacy GAAP Reporting Retrospective Method Evaluate Existing Contracts for Cumulative Effect Adjustment Dual reporting capability Maintain New Systems and Processes Maintain Existing Systems and Processes for Legacy GAAP Reporting Timeline is based on requirements applicable to a public entity with December 31 year end. Nonpublic entities may defer application of standard for one year beyond public entity effective date.

ALLOCATING TRANSACTION PRICES: SYSTEM CONSIDERATIONS
Automation of multiple element accounting Overview Main message is that we are seeing many companies who currently have a manual process for managing reallocation of consideration, now looking to automate that process as part of their implementation of the new standard. Whether by implementing an existing revenue automation tool, or by looking to the new ERP products. Address manually (Excel ®, other) Address with bolt-on third party revenue accounting automation tools Historical approach: We are seeing many companies who have not already automated revenue allocation looking to use this as an opportunity to fix that Opportunity

ASSESSMENT ACTIVITIES
Before designing the right system solution, an assessment needs to be performed; best practice approach is as follows: Accounting Diagnostic Process and information gap analysis Technology and Broader Impacts Transition Option Assessment Accounting policy Disclosure requirements Contract reviews Identify information requirements Identify information and process gaps Map to existing sources Identify potential impact on IT, tax , controls, ops, FP&A, investor relations, etc. Determine potential impact of each option to financials and business Assess readiness to elect each transition option Accounting diagnostic Process and information gap analysis Illustrative timeline for assessment phase: Week 1 Week 2 Week 3 Week 4 Week 5 Week 6 Technology and Broader Impact Evaluation Transition Option Assessment

IMPLEMENTATION TIMELINE
“Business as usual” Assess Design Implement Sustain May 28, 2014: New revenue recognition standard issued Effective date for public calendar year company 2 minutes 4 stages of standard implementation methodology Assess Design Implement Sustain Timeline is illustrative only – intended to show the approach that companies might take depending on the level of impact to their revenue policies and processes Some key points: A low impact company will be able to wait until later than a high impact company to start the process ALL companies will want to perform an assessment – even a company that believe they have no impact. This is important because while there are many companies that will fall into the LOW impact category, very few – perhaps none – will not be impacted at all. An assessment would include a detailed analysis of revenue recognition policy against the new standard. That process likely would include some detailed contract reviews. The timing of the assessment – indicated on the timeline by the light blue squares – could be delayed for lower impact companies. High impact companies – including companies that have multi-year arrangements – and companies that might want to adopt retrospectively will need to start assessing the impact during 2013 in order to leave sufficient time for designing and implementing process and system changes that may be required to reach a sustainable, scalable solution. The HIGH impact timeline indicate a sustainable solution should be in place by This would allow a company to tailor its process and systems so they could be leveraged to accumulate the information needed to perform the cumulative effect calculation. For a HIGH impact company with multi-year contracts, calculation of the cumulative effect adjustment will require reaching back even further than 1 year to obtain needed data…those companies will need to have a sutainable solution in place even earlier – or design an interim process for collecting needed information. For retrospective adopters, the same issue exists…the sooner a sustainable solution can be put in place, then the less reliance that has to be placed on manual workaround to collect and analyze data. Optional retrospective reporting period 2014 2015 2016 2017 Potential Scenarios: Low impact Moderate impact High impact Retrospective adopter Timeline intended to be illustrative only. Preparation of a timeline for a specific company will require making educated decisions based on specific facts and circumstances. Key:  Acctg. Assessment  Implementation  Design  Implement  Sustain Roadmap

Oracle Product Response
Seamus Moran, Financials Development

Oracle’s Product Response for Topic 606 & IFRS 15
Topic 606 and IFRS 15 Requirements & Objective Fusion Revenue Management Footprint & Features Transition Arrangements Peoplesoft & JD Edwards Where we are on the timeline 2 3 4 5

Fusion Revenue Management Cloud Service
Generally Available Release 8 (US GAAP) Revenue Management 21 Customers provided development and design feedback Over 1,000 hours testing 7 Usability sessions Week Long validation session

Understanding the Standard: Old versus New
Bill, then defer Four steps to valuation, then book that Mandate: Don’t recognize Revenue until all delivered Mandate: Recognize Revenue once performed VSOE, TPE, Estimate = Fair Value OSSP, ESP = Expected Consideration Deferred Revenue is a sales invoice you are feeding to the P&L Contract Assets are not Receivables, and you might even have billed already UBR are receivables you haven’t billed yet Revenue and Deferred Revenue are valued at invoice value Plus or minus Carve-ins and carve outs Contract Liability is a performance obligation you have not delivered on The Constraint Revenue and Contract Balances are valued at Performance Obligation value per Step Four Elements Units of Account Distinct Performance Obligations Contract With Customers Multiple Element Arrangement Follow Customer satisfaction Follow the carve out Revenue Schedule All Commercial Customers Performance Satisfaction Specific USA Industries

Scope – Topic 606 & IFRS 15 Reporting Obligations Revenue Value
Topic 606/IFRS 15 compliance Billing and revenue reconciliation Open Obligations Unaccounted Liabilities Assets Reporting Identify Contracts with Customers from multiple sources Identify Performance Obligations Obligations Calculate Transaction Price Allocate Transaction Price to Obligations Establish SSPs & ESPs Relative Allocation Revenue Value Recognize Revenue At Performance Obligation Valuation Contract Liabilities Contract Assets Transfer/satisfaction Satisfaction forecast Related Accounting Revenue Recognition

Fusion Revenue Management Outline: A Framework
Sources for Performance Obligations Fusion Revenue Management Output & Accounting Order Management (OM) Provide Contract, Satisfaction, Billing, Customer, Product & other relevant data Identify Contracts with Customers over different source data Identify performance obligations, categorize as performed or not Value the Contracts Value the Performance Obligations using relative SSP, ESP, etc. Record Revenue, Contract Liabilities and Contract Assets using Performance Obligations and their valuations. Reporting: Contract & Obligation Reporting Revenue, Billing & Obligation Reconciliation Performance forecast Account Receivables (AR) Project Management (PA) Contracts Pricing Advanced Pricing CRM Shipping Support Accounting: Publish data to accounting engines (eg SLA) Activity and Balances Other Products Custom, Excel, Non-Oracle et cetera CRM: Customer Relationship Management VSOE: Vendor Specific Objective evidence (for prices used) ESP: Estimated Selling Price SLA: Subledger accounting (a feature of Oracle eBusiness Suite Release 12)

Fusion Revenue Management Overview Business Scenario
Performance Obligations Revenue Values OSSP/ESP Software License Support Consulting Invoice Software License Support Consulting 100 20 80 98 26 76 Software License Support Consulting Transaction Price 100 20 80 200 Customer Bill Transaction Total 200 200 Software License Support Consulting Total 98.00 8.66 16.00 28.67 Performance Satisfaction Forecast Period I Period II 0.00 8.67 20.00 122.66 48.67 Period III 40.00

The 5 Steps are the Data Capture - Revenue Accounting is based on Performance Obligation ID & Valuation Recognize Revenue Recognize CL Recognize CA E.G. Search through “order lines” from many sources & Link ID distinct performance obligation from “order lines” Establish linked transaction price & constraint Apply relative observed SSP or ESP Revenue Bookkeeping Source Detail Contract ID Performance Obligation Amount To Bill Revenue Amount PO Xfr (from) / to PA Performance obligation 1000 - 4,000 (1,000) OM 5,000 Alien 1,000 2,000 1100 3,000 2,800 (200) Excel 2,500 2,700 200 2,350 1200 1,800

Co-Existence Functional Architecture On the Cloud (or on premise)
EBS Order Management EBS Service Contracts EBS Projects EBS Accounts Receivable 3rd Party Revenue Events Extracted via Delivered Source Views Fusion Revenue Management Create Accounting Audit & Analyze First Four Steps 5. Recognize Revenue Identify & 3. Value Contracts from many sources Establish SSP & ESP Identify & 4. Value Performance Obligations Separate revenue / billing Perf. Obligation Satisfaction –ratable, immediate, pending; Satisfaction forecasts Generate revenue and contract asset & liability balances entries using Performance Obligation valuation Seeded revenue reports for compliance reviews and audit Ad hoc reporting layer Customer Acceptance Payment Revenue Accounting EBS Order Management EBS Accounts Receivable EBS Costing General Ledger

Actionable Analytics and Reporting Spreadsheet Integration
Coexistence – Automated Revenue Management Centralized, Automated Revenue Management Automated Compliance Actionable Analytics and Reporting Centralized workarea Spreadsheet Integration FUSION REVENUE MANAGEMENT Revenue Sources Reference data Revenue accounting

ERP Cloud - Pre-packaged Integration Cloud to On-Premise Integration
Automated extract sales, contract and other revenue transactions from EBS Automated load of source contract transactions to ERP Cloud secured ‘Universal Content Management Server’ and subsequent processing for revenue recognition Compliant revenue subledger data exported to Accounting Define and load revenue pricing data using spreadsheets Predefined processes to synchronize customer and item data master data Actionable Analytics and Reporting Automated Compliance Centralized Dashboard Spreadsheet Integration REVENUE MANAGEMENT Cloud Revenue Accounting Reference Data Revenue Sources On-Premise

Oracle Fusion Revenue Management Addressing Key Challenges for Revenue Managers
Identify Contracts With Customers Automatically identifies Performance Obligations as part of a Contract With A Customer Supports cross application and cross document Contracts With Customers Calculate and Manage “Expected Consideration” revenue pricing Automatically groups stand alone sales based on user defined pricing dimensions Imports Estimated Selling Prices from Budgeting & other processes Supports multiple representations of SSP & ESP Allocate Transaction Price to Performance Obligations Automatic validation of compliance with Expected Consideration Creates adjustments based on relative observed selling prices and relative estimated sales prices Demand for Automation Automation of contract identification, expected consideration and performance obligation valuation

Centralized repository for reporting and accounting
Oracle Fusion Revenue Management Addressing Key Challenges for Revenue Managers Many Sources of Truth Centralized repository for reporting and accounting Track Performance Obligations separately to Receivables Revenue document follows the Performance Obligation using Step 4 valuation and planned customer fulfilment Automatically assign satisfaction events to recognize revenue on performance (and delay until performance) Generate accounting entries Adjust Performance Obligation Values Revenue price allocations automatically calculated, visible on the Revenue Document by performance obligation, ready for accounting Performance satisfaction forecasting, revenue value adjustments, delay or advance revenue on performance updates Manage Revenue Workarea provides centralized view of revenue tasks and status Central reporting platform for all revenue processing

Transition Data Need: Reprocess all/some transactions
Option One A, full retrospective, requires you to reprocess all transactions Option One B, practical expedient, requires you to reprocess all transactions relevant at year-ends, (deferred revenue balances plus some) Option Two requires you (a) to reprocess contracts already executed in your deferred revenue world as if they were in a performance obligation world, for the opening balance sheet for the year beginning after 1/1/2017, (b) and then to reprocess new contracts already executed in your performance obligation world under the new guidance, as if they were in a deferred revenue world, using the old guidance. Fusion Revenue Management ships with reprocessing capability

Transition There are two transition options with certain sub-options; nine ways in total. In practice, you need to model them all (planning, guidance, taxation, etc.) There is a substantial dollar value difference between them * deferred revenue that may never be realized * performance obligations that are already satisfied To model one option, you need to re-iterate with different performance obligation or different prices or different recognition rules: it will be reiterative We’re suggesting that: Use your existing RR system to do “old rules” Use FRM post Rel. 9 to do new rules in FY 2017 and iterative modeling before that Use Essbase to figure the difference between #1 and #2 for restatement purposes

Transition Comparison: $ impact & Full/Partial Retrospective Model new rules in Fusion Revenue Management, compare and iterate as needed, and cutover in CY 2016 FY 2016 FY 2017 Old Rules & Restatement until last balance sheet before adoption (2017) New Rules Apply Home Grown FY15, FY16 General Ledger Content EPM & Original Financial Statements EPM & Restated Financial Statements Existing Revenue Recognition Process Oracle Essbase FY 17 General Ledger Content EPM & Original Financial Statements Iterative Modeling Compare and Contrast Old and New in Oracle Essbase Topic 606 / IFRS 15 Using Fusion Revenue Management Cutover

Transition Alternative 1: Reiterative Models in Oracle Essbase Fusion Revenue Management reprocessing under New Rules Existing Revenue Recognition system continues to push data to GL for Financial Statement reporting purposes through 2017 under current rules And also sends data (extracts, reports) to Essbase for comparison to new rule output FRM is set up in 2015 or 2016 for modeling purposes and 2017 bookkeeping FRM iteratively reprocesses all (full retrospective) or some (practical expedients) existing transactions from their inception point, using new input as to implicit performance obligations, pricing and revenue recognition rules, as often as required. Output is directed to the same Essbase cube where the results are compared and contrasted. Output from the Essbase comparison is used to restate the FY14, FY15, FY16 financial statements & opening balance for 2017 FRM reprocesses all transaction from FY 2016 & earlier that have deferred revenue or performance obligations on opening day, and pointed to General Ledger from Day one of FY 2017

Transition Comparison: $ Impact, Big Bang & Later Disclosure Model new rules in Fusion Revenue Management, compare and iterate as needed, and cutover in CY 2016 FY 2016 FY 2017 Old Rules & Restatement until last balance sheet before adoption (2017) New Rules Apply FY15, FY16 General Ledger Content EPM & Original Financial Statements Home Grown Oracle Essbase EPM & Restated Financial Statements Existing Revenue Recognition Process Old Revenue System Maintained until +/- 2020 Oracle Essbase FY 17-> General Ledger Content EPM & Original Financial Statements Iterative Modeling Compare and Contrast Old and New in Oracle Essbase Topic 606 / IFRS 15 Using Fusion Revenue Management Cutover

Peoplesoft: Flexible Software Adaptable to Each Organization’s Needs
Planned for 9.2+ Peoplesoft: Flexible Software Adaptable to Each Organization’s Needs Configuring Customer Contracts to Support the New Revenue Accounting Standard The Planned Solution for You Features That Promote Compliance with New Converged Standard Tools and Functionality that Provide Options Without Forcing Change on Organizations With Simpler Contracts New Planned Capabilities Streamlined Allocation of Contract Price New Attributes to Identify Bundled Products and Services Price Determination for Revenue Flexibility to Maintain Prices for Revenue Separately from Billing Mgt of Contract Obligations, Reports, & Support of Price Audits Impacts All Organizations with Revenue from Customers Biggest Impact-Multiple Products & Services Bundled Products, Variable Prices, Fin’d Prod New Revenue Recognition Requirements Comprehensive Transition and Comparative Reporting Reqts. New Accounts In GL and Additional Schedules at Qtr/Yr End Documentation and Audit

JDE: Accounts Receivable Revenue Recognition
Invoice Entered Invoice to Revenue Recognition Process Performance Liability Booked in G/L Performance obligation complete Revenue Recognized Performance Liability Cleared from G/L Revenue Booked in G/L New Feature New feature to support recognition of revenue for invoices without a contract Performance Liability Accounting Recognize all, none, less than, or more than the invoice amount Performance obligation completion is determined by a process defined by the organization utilizing the system Audit trail of all revenue recognition activity

JDE Contracts Revenue Recognition
Contract Entered Identify performance obligations (billing lines) Trace project tasks to performance obligations Project Executed Accumulation of costs Contract invoices created Manage changes to contract Add new performance obligations Disposition existing performance obligations Revenue Recognized Performed independently from contract invoicing Specified for each performance obligation Revenue Booked in G/L New Flexibility Additional capabilities to tie detailed project costs to contract performance obligations Flexibility to manage change orders and existing contract performance obligations in different ways More control of invoicing that affect revenue adjustments

Understanding the Standard: Old versus New
Bill, then defer Four steps to valuation, then book that Mandate: Don’t recognize Revenue until all delivered Mandate: Recognize Revenue once performed VSOE, TPE, Estimate = Fair Value OSSP, ESP = Expected Consideration Deferred Revenue is a sales invoice you are feeding to the P&L Contract Assets are not Receivables, and you might even have billed already UBR are receivables you haven’t billed yet Revenue and Deferred Revenue are valued at invoice value Plus or minus Carve-ins and carve outs Contract Liability is a performance obligation you have not delivered on The Constraint Revenue and Contract Balances are valued at Performance Obligation value per Step Four Elements Units of Account Distinct Performance Obligations Contract With Customers Multiple Element Arrangement Follow Customer satisfaction Follow the carve out Revenue Schedule All Commercial Customers Performance Satisfaction Specific USA Industries

Understanding the Standard : Old versus New
FASB IASB Advisors Software Ext Rptg Mgmt Public Companies Jan 1, 2017 Repealed Bill, then defer Four steps to valuation, then book that Mandate: Don’t recognize Revenue until all delivered Mandate: Recognize Revenue once performed VSOE, TPE, Estimate = Fair Value OSSP, ESP = Expected Consideration Deferred Revenue is a sales invoice you are feeding to the P&L Contract Assets are not Receivables, and you might even have billed already UBR are receivables you haven’t billed yet Revenue and Deferred Revenue are valued at invoice value Plus or minus Carve-ins and carve outs Contract Liability is a performance obligation you have not delivered on The Constraint Revenue and Contract Balances are valued at Performance Obligation value per Step Four Elements Units of Account Distinct Performance Obligations Contract With Customers Multiple Element Arrangement Follow Customer satisfaction Follow the carve out Revenue Schedule All Commercial Customers Performance Satisfaction Specific USA Industries

FRM Initial Release: US GAAP “VSOE” support Released in March 2014
New Standard Concept Release 8 & 9 VSOE Concept Contract with Customer Multiple Element Arrangement Performance Obligation Element of the Arrangement Observed/Estimated Standalone SP VSOE, TPE, ESP Contract Liability Deferred Revenue

FRM Initial Release : US GAAP “VSOE” support Released in March 2014
New Standard Concept Release 8 & 9 VSOE Concept Contract with Customer Multiple Element Arrangement Performance Obligation Element of the Arrangement Observed/Estimated Standalone SP VSOE, TPE, ESP Contract Liability Deferred Revenue

Fusion Revenue Management Timelines
Release 8 is generally available (March 2014), moving to 9 now Early adopters signing up More information available on cloud.oracle.com Release update for new standards March ‘14 May 28, 2014 Today TBD Don’t Panic, Do Hurry Up Release Updates Code & Test Customers & Big 4 Review & Study Final Standard

Fusion Revenue Management Availability
Release 8 and 9 (VSOE) (available since March ‘14) EBS & Instance integration Identify “MEA” Identify “Element” Value “MEA” Value “Element”; VSOE Five Steps Accounting for Deferred Revenue (sales invoices) US Hitech VSOE delivery Summer 2015 ID Contracts w. Customers ID Performance Obligations Value Contract Value Performance Obligation; SSP, ESP Valuation before invoicing Accounting for Performance Obligations (steps 2 & 4) General Non-Specific Framework Other Plans Customer & Big Four Input, as available Specific Industry compliance Additional Features in Revenue Management Additional features in Receivables, Project Accounting, et cetera Disclosure Reporting

More about Fusion Revenue Management
Conference Session Thursday, Oct 02 10:15 AM - 11:00 AM CON Oracle Fusion Revenue Management Cloud Service: Highlights and Customer Adoption Tapomoy Dey, Senior Director, Oracle Westin Market Street Metropolitan II Monitor our blog at

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Oracle’s Initial Response to Topic 606 & IFRS 15, Revenue from Contracts with Customers Stephen Thompson, KPMG Seamus Moran, Oracle Financials Development.

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