Accounting Clip Level Interpretation

Worldwide Clip Level Guidance

Please reference worldwide clip level guidance at the following website (last updated June 2017):
https://w3-connections.ibm.com/wikis/home?lang=en-us#!/wiki/W38292ad69e32_4abc_bd55_32ad9c9ef2e2/page/AI-CTRL%2012-014%20Accrual%20and%20Journal%20Clip%20Guidelines

Work Number Policy

The 100K clip-level applies to the contract, so entries can be split by work numbers within reason.

Invoice Bundling Policy

Invoices below 100K cannot be bundled with other invoices to meet clip level.

Close Schedule Daily Clip-level (Accruals and Deferrals)

Work Day Non-Quarter Quarter

1W 100K 100K
2W 100K 100K
3W 100K 100K
4W 100K 100K
Hyperion 5W-6W 500K 500K

Transition Revenue
The 100K clip-level applies to the total SOW billings per contract and at least one billing must be greater than 100K. Once the clip-level
is obtained, all billings should be deferred including those under 100K. Note: The 100K clip-level is applied to PCR’s independently
from the original contract.
Vouchers' back up template - 2017

In this template you will find the mandatory back up to be included in your vouchers for accounting approval.
Please, click on the type of voucher:

- Revenue Accrual
- ARC - RRC Accrual
- Credit Note Accrual
- Revenue Deferral
- Deferred Revenue Recognition
- Cost Accrual
- Pre Contract Cost Deferral
- Hardware OEM Cost Deferral
- Prepaid SW and Prepaid Maintenance
- Netting Adjustments
- Currency Rate Adjustments
- Error Corrections

Please consult accounting if you require an entry that does not fit any of the parameters listed above, thank you!

*Link to clip level guidelines.

eters listed above, thank you!
Go back to index
2020 Accounting Accrual/Deferral Request F

Section I: Entry Type and Balance Sheet Guid

Revenue Accrual Guidance

IBM has earned revenue but has not yet billed customer.
This account is used to accrue revenue due to invoicing missing CFTS cutoff dates or BAU billing in arrears.
Please note revenue entry must be booked with autoreverse ( only exception for Year End).

Accrual Clip Level: 100K USD per contract

The debit goes to the balance sheet account ( major 107) and the credit goes to revenue (HELP)( major 3XX).

Backup Required:
- Reason for accrual.
- Evidence of rendered service:
- If the contract requires customer acceptance, please attach it.
- If the contract does not require customer acceptance, please attach PM's validation, claim/vendors/me
that validate that the service was rendered.
- Print of ledger showing costs related with this accrual.
- Invoice or spreadsheet detailing amount to be accrued and how it is calculated
- PO documentation (if necessary).
- Expected clear date.
- Billing's team confirmation (In order to confirm that they have all the elements required to release the billin
If:
- LA (Not Xser): CSO/billing team approval or Global's instruction.
- SSA: Country's CFO approval.
- CA: CSO/billing team approval or Global's instruction.
- Invoice in arrears unbilled: contract clause/article

For unbilled reversals ( in case was booked incorrectly without autoreverse): Accruals back up and ledger print
Data that must be included on the ledger print: Contract , Full revenue account number, Month, Invoice numbe

Section II: Customer Data

TOTAL AMOUNT 602,821.47

Where in the backup can this amount be The amount is included in the tab "GBS T&M". The amount is pul
found / how is the amount calculated? been invoiced.
 Section III: Business Justification / Additional Inf

1) Reason for accrual/deferral To accrue T&M hours for the current month that are not billed un

2) When were the services provided? June 1, 2021 - June 30, 2021
(Months from/to)
If the aging exceed 90 days please add an explanation of the delay ( Explanation of the issue/Actions that were

3) Expected clear date 7/2/2021

Explanation (if needed)
#REF!
4) Is this a PO Customer? No
If yes, please attach the PO on GLUI´s backup section

5) Is this an existing contract? Yes

6) Was the contract/PCR/ Ammendment No

signed in current month?
If yes, when was documentation submitted to STS for registration? Provide day/month.
unting Accrual/Deferral Request Form - Revenue

ection I: Entry Type and Balance Sheet Guidance

Revenue Accrual Guidance

S cutoff dates or BAU billing in arrears.

exception for Year End).

edit goes to revenue (HELP)( major 3XX).

e attach PM's validation, claim/vendors/metrics report , or any documentation

it is calculated

l the elements required to release the billing)

reverse): Accruals back up and ledger print of the invoice billed

nue account number, Month, Invoice number.

Section II: Customer Data

ed in the tab "GBS T&M". The amount is pulled from a system generated report that identifies what hours have not
on III: Business Justification / Additional Information

for the current month that are not billed until the following month.

0, 2021

Explanation of the issue/Actions that were taken to solve it)

Provide day/month.
Go back to index
2017 Accounting Accrual/Deferral Request Fo

Section I: Entry Type and Balance Sheet Guid

ARC / RRC Accrual Guidance

Customer either entitled to credit IBM for resources deviating from agreed baselines.
Actuals if unbilled or a three-month average calculation are commonly used to accrue RRCs to the unbille
account.

ARC - RRC Accrual Clip Level: 100K USD per contract

For RRC accrual, credit goes to the balance sheet and the debit goes to revenue (HURT).
For ARC accrual, debit goes to the balance sheet and the credit goes to revenue (HELP).

Backup Required:
- Billing approval and Finance Manager approval
- PM's reason for accrual
- Spreadsheet or calculation detailing amount to be accrued

- For ARC accrual reversals: Accruals back up and ledger print of the billed invoice.
- For RRC accrual reversals: Accruals back up and ledger print of the billed credit note.

Section II: Customer Data

TOTAL AMOUNT
Where in the backup can this
amount be found / how is the
amount calculated?

Section III: Business Justification / Additional Inf

1) Reason for accrual/deferral

2) When were the services

provided? (Months from/to)
If the aging exceed 90 days please add an explanation of the delay ( Explanation of the issue/Actions that

2) Expected clear date

Explanation (if needed)
 ccounting Accrual/Deferral Request Form - Revenue

Section I: Entry Type and Balance Sheet Guidance

ARC / RRC Accrual Guidance

viating from agreed baselines.

are commonly used to accrue RRCs to the unbilled revenue

e debit goes to revenue (HURT).

e credit goes to revenue (HELP).

er print of the billed invoice.

er print of the billed credit note.

Section II: Customer Data

Section III: Business Justification / Additional Information

f the delay ( Explanation of the issue/Actions that were taken to solve it)
Go back to index
2017 Accounting Accrual/Deferral Request Fo

Section I: Entry Type and Balance Sheet Guid

Credit Note Accrual Guidance

IBM has overbilled customer (customer has NOT paid invoice) or an invoice was wrongly done and will i
If customer is overbilled and the credit invoice misses the billing cutoff, the credit accrual will go to the cr

Credit Note Accrual Clip Level: 100K USD per contract

The credit goes to the balance sheet and the debit goes to revenue (HURT).

Backup Required:
- Invoice or spreadsheet detailing amount overbilled
- Billing explanation or justification if it applies
- Ledger detail : Contract , Full revenue account number, Month, Invoice number.
-Timing issue: Billing approval and Finance Manager approval
- Duplicate Revenue: Billing approval and ledger print of the doubled movement
- Potential penalties: PM's note / legal team assesment / clients' request with estimate value accrual.
- Contract language (if necessary).
- For credit note accrual reversals: Accrual's back up and ledger print of the credit note billed or explana
Section II: Customer Data

TOTAL AMOUNT
Where in the backup can this
amount be found / how is the
amount calculated?

Section III: Business Justification / Additional Inf

1) Reason for accrual/deferral

2) Expected clear date

Explanation (if needed)
 ccounting Accrual/Deferral Request Form - Revenue

Section I: Entry Type and Balance Sheet Guidance

Credit Note Accrual Guidance

nvoice) or an invoice was wrongly done and will issue a credit invoice in the future.
e billing cutoff, the credit accrual will go to the credit note accrual account.

to revenue (HURT).

er, Month, Invoice number.

of the doubled movement

t / clients' request with estimate value accrual.

nd ledger print of the credit note billed or explanation if the credit note will not be issued.
Section II: Customer Data

Section III: Business Justification / Additional Information

Go back to index
2017 Accounting Accrual/Deferral Request Fo

Section I: Entry Type and Balance Sheet Guid

Revenue Deferral (Content) Guidance

IBM has not earned revenue which has already hit ledger.
This account is used to temporarily hold deferred revenue until we are able to recognize.
Amount deferred should NOT be amortized.
Most commonly used with advance billing, but can also be utilized with accounting ruling.
Revenue submissions are due by 2W. Alert your sector accountant if you require a late submission.

Revenue Deferral Clip Level: 100K USD per contract

Backup Required:
- Invoice, calculation, or other documentation of amount being deferred
- Ledger detail : Contract , Full revenue account number, Month, Invoice number.
- Accounting ruling, if applicable
- Reason for deferral (i.e. Collectivity problems, clients' acceptance, etc.)
- Paid in advance services: start and end date
- If the contract specifies clients' acceptance for revenue recognition, include contract clause/article
- If deferred due to collectivity problems, include notes from Legal team or PM
- If deferred due to service not rendered, include PM or PE notes and expected clear date
- Amortization schedule (if necessary).
*Remember: If the contract does not have Baseline revenue, you should defer associated costs.

Section II: Customer Data

TOTAL AMOUNT
Where in the backup can this
amount be found / how is the
amount calculated?

Section III: Business Justification / Additional Inf

1) Reason for accrual/deferral

2) Expected clear date

Explanation (if needed)
3) Is this a PO Customer?
 ccounting Accrual/Deferral Request Form - Revenue

Section I: Entry Type and Balance Sheet Guidance

Revenue Deferral (Content) Guidance

ue until we are able to recognize.

be utilized with accounting ruling.

accountant if you require a late submission.

unt being deferred

er, Month, Invoice number.

' acceptance, etc.)

ue recognition, include contract clause/article

s from Legal team or PM
or PE notes and expected clear date

ne revenue, you should defer associated costs.

Section II: Customer Data

Section III: Business Justification / Additional Information

Go back to index
2017 Accounting Accrual/Deferral Request

Section I: Entry Type and Balance Sheet Gu

Deferred Revenue (non T&T) Recogniti

IBM is able to recognize revenue that has been deferred.

Backup Required:
- Rendered service for clients:
- Print of ledger showing involved costs of the rendered services
- PM's clarification that services were delivered, and that there were no issues.
- No clients' acceptance is needed.

- If needs clients' acceptance:

- Clients' acceptance of the service rendered: add spreadsheet with values' detail. DIGITAL ACCEPT

- If T&M:
- P*Q: Claim report/Clients' acceptance

- If OEM: check OEM Form Instructions

- Contract Review Gross vs. Net analysis.
- OEM installation evidence.
- booked project costs.

- If OEM was not installed, accounting exception should be requested:

- OEM shipment.
- Invoice issued by Billing team (is not possible to perform unbilled)
- PM or Delivery validation that IBM has the capability to install the OEM in thirty days.
- Installation plan signed by the customer.
- Detail of the OEM products to be installed.
- Booked project costs.
- Gross Assessment
- 1st line accounting manager approval.
- F&P manager approval

Section II: Customer Data

TOTAL AMOUNT -
Where in the backup can this
amount be found / how is the
amount calculated?

Section IV: Business Justification / Additional I

1) Reason for accrual/deferral

2) Expected clear date

Explanation (if needed)
Accounting Accrual/Deferral Request Form - Revenue

Section I: Entry Type and Balance Sheet Guidance

Deferred Revenue (non T&T) Recognition

dered services
nd that there were no issues.

spreadsheet with values' detail. DIGITAL ACCEPTANCE SHOULD BE ACCEPTED IN THE COUNTRY BY LEGALS.

be requested:

perform unbilled)
ility to install the OEM in thirty days.

Section II: Customer Data

Section IV: Business Justification / Additional Information
Go back to index
2017 Accounting Accrual Request Form

Section I: Entry Type and Balance Sheet Guid

Cost Accrual

IBM has incurred the cost, but due to timming issues they not impact ledger. This costs must be invoice

This account is used to accrue revenue due to invoicing missing CFTS cutoff dates or BAU billing in arrears

Accrual Clip Level: 100K USD per contract

The credit goes to the balance sheet and the debit goes to cost (HURT).

Backup Required:
- Evidence of rendered service (PM's validation, claim/vendors/metrics report , or any documentation)
- Vendor PO / bond image ( in case of invoices not received)
- Month when the cost was incurred ( Aging of original PO)
- Expected clear date
- Amount validation ( Document to validate the amount or calculation's file).

Data that must be included on the ledger print: Contract , Full revenue account number, Month, Invoice n

Section II: Customer Data

TOTAL AMOUNT
Where in the backup can this
amount be found / how is the
amount calculated?

Section III: Business Justification / Additional Inf

1) Reason for accrual

2) When were the services

received? (Months from/to)
If the aging exceed 90 days please add an explanaition of the delay ( Explanation of the issue/Actions that

3) Po Reference
4) Expected clear date
Explanation (if needed)
 2017 Accounting Accrual Request Form - Cost

Section I: Entry Type and Balance Sheet Guidance

Cost Accrual

hey not impact ledger. This costs must be invoiced to the vendor.

missing CFTS cutoff dates or BAU billing in arrears.

to cost (HURT).

vendors/metrics report , or any documentation)

unt or calculation's file).

t , Full revenue account number, Month, Invoice number.

Section II: Customer Data

Section III: Business Justification / Additional Information

f the delay ( Explanation of the issue/Actions that were taken to solve it)
Go back to index
2017 Accounting Deferral Request F

Section I: Entry Type and Balance Sheet G

Pre Contract Cost Deferral (Content) Gu

We book a cost deferral when its associated revenue has not been recognized and there is a future b

Cost Deferral Clip Level: 100K USD per contract -

Backup Required for pre contract costs:

- LOA Signed.
- Approval from CRT to deffer cost.
- Evidence of costs in the ledger.
- Data quality if it is available (contract, project, etc.).
**Note: Differ only if the LOA is signed within six months.

Section II: Customer Data

TOTAL AMOUNT
Where in the backup can this
amount be found / how is the
amount calculated?

Section III: Business Justification / Additiona

1) Reason for accrual/deferral

2) Expected clear date

Explanation (if needed)
2017 Accounting Deferral Request Form - Cost

Section I: Entry Type and Balance Sheet Guidance

Pre Contract Cost Deferral (Content) Guidance

as not been recognized and there is a future benefit relates to these costs.

Section II: Customer Data

Section III: Business Justification / Additional Information

Go back to index 2017 Accounting Accrual/Deferral Request Form - Revenue

Section I: Entry Type and Balance Sheet Guidance

HW OEM Cost Deferral

HW OEM cost deferrals are to be done when machines invoices are already registered in IBM,
delivery / installation has not ocurred.

Clip level is applied per PO

Backup required for the Deferral

1) PO (Accounting may review the PO content trough Procurement Order Info Tool)
2) Evidence of the cost hitting the ledger. This evidence must contain at least:
LC Year
Div Month
Maj Field with the PO in ledger (usually in the local field)
Minor
Sbmin
Amount
3) Evidence of the calculation of the amount that is being required to be deferred
i.e: OEM Serial Q * Unit Cost = Total deferred due to no installation
4) Evidence of no revenue recognized for that contract
5) Expected clear date for the installation

Backup required for the Deferral reversal

1) Evidence of the revenue hitting the ledger. This evidence must contain at least:
LC Year
Div Month
Maj Contract
Minor Project
Sbmin Customer
Amount
2) Evidence of the calculation of the amount that has been installed (this must be related to the original defe
i.e: OEM Serial Q * Unit Cost = Total deferred due to no installation
3) If the deferral reversal is not related to HW OEM installation pls provide the corresponding explanation an
m - Revenue

nce

lready registered in IBM, but

related to the original deferral backup previously to Accounting)

rresponding explanation and further documentation.

Go back to index 2017 Accounting Accrual/Deferral Request Form - Revenue

Section I: Entry Type and Balance Sheet Guidance

Prepaid SW and Prepaid Maintenance

Pre paid SW OEM licences and Pre paid Maintenance Services are to be deferred when
provide future benefit during the contract life.

Clip level is applied per PO

Backup required for Term Licences or Pre paid Maintenance Services

1) PO (Accounting may review the PO content troughProcurement Order Info Tool)

2) Evidence of the cost hitting the ledger. This evidence must contain at least:
LC Year
Div Month
Maj Fiel with the PO in ledger (usually in the local field)
Minor
Sbmin
Amount
3) PO Detail or Supplier invoice where the usefull life or services period can be validated.
If the usefull life is not stated in any of the document listed above, IBM-supplier agreement or any
other documentation that validate the usefull life must be included.

Backup required Perpetual SW Licences

1) PO (Accounting can review the PO content troughProcurement Order Info Tool)

2) Evidence of the cost hitting the ledger. This evidence must contain at least:
LC Year
Div Month
Maj Fiel with the PO in ledger (usually in the local field)
Minor
Sbmin
Amount
3) PO Detail or Supplier invoice wher the usefull life or services period can be validated.
If the usefull life is not stated in any of the document listed above, IBM-supplier agreement or any
other documentation that validate the usefull life must be included.
4) Perpetual Facthseet must be completed and included in Glui as backup documentation

C:\Users\
IBM_ADMIN\
Desktop\
Worksheet in
Accounting
Services
Education.xls
 Backup required Other Prepaid Services

1) PO (Accounting can review the PO content troughProcurement Order Info Tool)

2) Evidence of the cost hitting the ledger. This evidence must contain at least:
LC Year
Div Month
Maj Fiel with the PO in ledger (usually in the local field)
Minor
Sbmin
Amount
3) With future benefit: PO Detail or Supplier invoice where the useful life or services period can be va
If the useful life is not stated in any of the document listed bellow, IBM-supplier agreement or any
other documentation that validate the usefull life must be included.
4) If the prepaid Services to be deferred does not apply with item 3) pls provide deferral reason and fu
documentation as applicable, and Expected Clear Date.

*No IBM Labor or subcontracted labor (as Adecco or Manpower) can be deferred under this Section
erral Request Form - Revenue

Balance Sheet Guidance

epaid Maintenance

nance Services are to be deferred when they will

during the contract life.

pplied per PO

s or Pre paid Maintenance Services

rement Order Info Tool)

ust contain at least:

in the local field)

rvices period can be validated.

ted above, IBM-supplier agreement or any
be included.

rpetual SW Licences

rement Order Info Tool)

ust contain at least:

in the local field)

ices period can be validated.

ted above, IBM-supplier agreement or any
be included.
Glui as backup documentation
her Prepaid Services

rement Order Info Tool)

ust contain at least:

in the local field)

e the useful life or services period can be validated.

ed bellow, IBM-supplier agreement or any
be included.
h item 3) pls provide deferral reason and futher

npower) can be deferred under this Section

Go back to index
2017 Accounting Adjustments Reque

Section I: Entry Type and Balance Sheet Gu

Gross/Net Adjustments

OEM Content (HW/SW or Services), which has been qualified as Net transactions as a result of the Gros
Record the Net position of sales done by IBM
Please reference Accounting Practice AP-09 interpretation 02-01 for additional details:
https://w3-connections.ibm.com/wikis/home?lang=en-us#!/wiki/Wc969f0323dad_42f6_ba75_d1369e3fe646/page

Backup Required:
- Contract Review Team assesement
- Print of ledger showing revenue and costs of the contract
- TCV

Section II: Customer Data

Customer Name
Customer Number
Contract Number
Project Number

TOTAL AMOUNT
Where in the backup can this
amount be found / how is the
amount calculated?

Section III: Cost/Revenue Informatio

Revenue Account

Division
Major
Minor
Subminor

Cost Account

Division
Major
Minor
Subminor
 2017 Accounting Adjustments Request Form

Section I: Entry Type and Balance Sheet Guidance

Gross/Net Adjustments

ified as Net transactions as a result of the Gross vs. Net review.

n 02-01 for additional details:

ki/Wc969f0323dad_42f6_ba75_d1369e3fe646/page/AP09

Section II: Customer Data

Date
FA
PM - PE

Section III: Cost/Revenue Information

Brand SPL/Division
Not Services Major Not Services Major

Brand SPL/Division
Not Services Major Not Services Major
Go back to index
2017 Accounting Adju

Section I: Entry Type and

Currency rate

Differences are given by mismatches in entries with different revaluation indicators

Debit or credit goes in the balance sheet account, against OID.

Backup Required:
- Accounting manager approval
- Explanation of the adjustment
- Calculation and Ledger evidence.

Section II: Cu

Customer Name
Customer Number
Contract Number
Project Number

TOTAL AMOUNT
Where in the backup can this
amount be found / how is the
amount calculated?
2017 Accounting Adjustments Request Form

Section I: Entry Type and Balance Sheet Guidance

Currency rate Adjustments

rent revaluation indicators

Section II: Customer Data

Date
FA
PM - PE
Go back to index
2017 Accounting Adju

Section I: Entry Type and

Error Co

Entries were/are incorrectly booked and need to be reclassified.

Back up required if:

● Accounts Reclassification
- Reason for reclassification
-If the adjustment involves other brands, request the other side approval ( I&E: F&P

● Contract Reclassifications
- Reason for reclassification
- Project Manager's approval
- Ledger detail: Contract , Full account number, Month, Invoice number.

Incorrect Voucher Number

and/or
Explanation of error/correction

Section II: Cu

Customer Name
Customer Number
Contract Number
Project Number

TOTAL AMOUNT
Where in the backup can this
amount be found / how is the
amount calculated?
2017 Accounting Adjustments Request Form

Section I: Entry Type and Balance Sheet Guidance

Error Correction

ther side approval ( I&E: F&P manager or BS: Account reconciler)

Invoice number.

Section II: Customer Data

Date
FA
PM - PE