Overview
The Multi Element Revenue Reallocation (sometimes also known as MEA) feature in LISA Business enables compliant revenue allocation for contracts that include multiple deliverables bundled into a single commercial arrangement. Typical examples include subscriptions bundled with setup fees, support services, usage components, or hardware.
MEA ensures that total contract consideration is allocated to individual performance obligations based on their relative Standalone Selling Prices (SSP), in alignment with modern revenue recognition standards such as ASC 606 and IFRS 15. This allows revenue to be deferred, allocated, and recognized accurately over time, even when invoicing patterns differ from delivery or service fulfillment.
The feature is especially relevant for subscription-based, SaaS, and service-oriented business models where bundled offerings and non-linear billing are common.
Business Value
Implementing MEA delivers both financial compliance and operational value across finance, sales, and revenue operations.
From a compliance perspective, MEA enables organizations to meet ASC 606 and IFRS 15 requirements by enforcing relative SSP-based allocation. This significantly reduces audit risk, manual adjustments, and reliance on spreadsheets during period-end close. Finance teams gain a defensible and repeatable allocation methodology that auditors can easily trace and validate.
From a revenue accuracy standpoint, MEA prevents revenue distortion caused by invoice-driven recognition. Without MEA, businesses often recognize too much or too little revenue upfront when bundles are sold at promotional or negotiated prices. MEA ensures that discounts are proportionally distributed across all performance obligations, preserving correct revenue timing and margin reporting.
From an operational efficiency perspective, predefined MEA templates and default mappings reduce manual intervention. Revenue allocation decisions are automated and consistent, even at high transaction volumes, allowing finance teams to scale without increasing complexity or headcount.
From a business insight perspective, accurate allocation improves reporting quality. Product-level revenue, deferred revenue balances, and contract asset/liability positions better reflect economic reality, enabling leadership to make more informed pricing, packaging, and investment decisions.
Overall, MEA transforms revenue recognition from a reactive accounting task into a controlled, auditable, and scalable process embedded directly into order-to-cash operations.
Configure MEA Templates
MEA Templates allow you to predefine how revenue should be treated for common bundled arrangements. These templates can then be reused across transactions, ensuring consistency and reducing setup effort during order processing.
MEA Templates can be accessed from the LISA Business Setup tab in the main menu of the Subscription Manager role.
Multiple Element Arrangement Number
Provide a unique, human-readable identifier for the MEA template. This identifier is used for selection and reporting and should reflect the nature of the bundled offering (for example, “SaaS Annual Bundle” or “Subscription + Setup”).
Description
Provide a clear, business-friendly description of the MEA template. This helps users understand when the template should be applied and supports audit transparency.
Deferred Contract Revenue Account
Specify the general ledger account that will hold deferred contract revenue created by MEA logic. This account is used when revenue must be postponed due to revenue recognition rules, such as time-based services or future performance obligations.
Configure Default MEA Templates
Default MEA Templates allow automatic application of MEA logic based on billing characteristics, eliminating the need for users to manually select templates on each transaction.
This configuration links MEA Templates to billing period definitions in LISA Business and is particularly useful for subscription businesses with standardized billing cycles.
Billing Period
Specify whether the billing period length is defined in Months or Days. This determines how the system evaluates transaction lines.
Billing Period Length
Enter the numerical length of the billing period (for example, 12 for a 12-month subscription or 365 for a one-year term in days).
Customer Posting Group
Optionally restrict the default behavior to a specific Customer Posting Group. When populated, the MEA template is only applied to customers belonging to this group, enabling differentiated revenue treatment by customer segment or geography.
MEA Template
Select the MEA Template that should be automatically applied when the billing period criteria are met.
Active
Indicate whether the configuration is active. Inactive records are ignored by the system and allow historical configurations to be retained without operational impact.
Configure Standalone Selling Prices
Standalone Selling Prices (SSP) are a core requirement for compliant MEA allocation. They represent the price at which each item or service would be sold separately under normal circumstances.
LISA Business uses SSPs to allocate total contract consideration proportionally across bundled items. Standalone Selling Prices can be accessed from the LISA Business Setup tab in the main menu of the Subscription Manager role.
Item No
Select the item for which the standalone selling price is being defined. This can be a subscription item, service, or any bundle component.
Standalone Selling Price Origin
Choose whether the SSP should be derived from the Item’s Base Price or from a custom Amount defined specifically for MEA purposes. Using Base Price is common when list prices are well maintained, while custom amounts are often used when pricing is negotiated or market-driven.
Standalone Selling Price
If Amount is selected as the origin, enter the custom standalone selling price here. This value represents the fair value used for revenue allocation, not necessarily the invoiced amount.
Revenue Amount
This read-only field displays the effective SSP used by the system. It is automatically populated based on either the Item Base Price or the custom Standalone Selling Price and provides transparency into the allocation basis.