The JDAccounts Receivable Newsletter is taking on a new direction and will, henceforth,

encompass the greater global Revenue Teams including: Revenue Operations – Contract

Entry, Maintenance Renewal, Billing and Credit & Collections; Revenue Accounting – Project

Accounting, Project Services Group and Maintenance; and Decision Support (Revenue

Recognition) – License, VSOE (Vendor Specific Objective Evidence), Service Revenues

(SOW’s) and Managed Services.

Each of these areas are an integral and critical component of the Revenue and Contract-

to-Cash cycle, and the ultimate goal of this publication is to provide you, our JDA partners,

with relevant and meaningful information, metrics, news, and tips from the myriad of

resources/associates that make it all happen.

The success of this newsletter hinges on feedback, questions, and contributions from

throughout the JDA world; therefore, we encourage you to participate so we can provide

you with an informative and service driven publication.

Welcome to the JDA ReveNews!

Welcome to the JDA ReveNews

O Inside This Issue

1 Welcome to the JDA ReveNews

2 Rev Rec – Four Basic Rules

3 A few minutes with Jimmy Shkalla

4 Q2 Invoicing

5 JDA Welcomes

6 Revenue Accounting Team

7 JDA’s Mo$t Wanted

8 Revenue Support Team Matrix

JDA ReveNews

VOLUME 1 ISSUE 1

July 2011

Revenue Recognition – Four Basic Rules

O

Revenue Recognition in our industry is unique, and the origin of the accounting rule known as SOP (Statement of Position) 97-2

dates back to 1983 when a computer services trade organization known as ADAPSO conducted a survey to determine

accounting practices throughout the computer services industry. The survey revealed mixed results which led to the Accounting

Standards Executive Committee (AcSEC) involvement in developing SOP 91-1 in December 1991 – the official standard in

Software Revenue Recognition.

In 1997 AcSec issued a replacement to SOP 91-1 to address additional industry relevant details, and from those changes, the new

SOP 97-2 Software Revenue Recognition rule was born. The question is often asked – what are the criteria, or requirements in

fulfilling SOP 97-2, or in more layman terms, when is a sale officially recorded – herein, are the four basic rules:

Persuasive evidence of an arrangement exists

Delivery has occurred

The vendor's fee is fixed or determinable

Collectability is probable

This month we will discuss the first rule, or Persuasive Evidence of an Arrangement Exists. The three additional rules will be

highlighted in the next three monthly newsletter editions.

Persuasive Evidence of an Arrangement Exists

A fully executed contract signed and dated by both the customer and JDA must be received prior to the end of a

quarter

Deadline = 12:00 AM (midnight) Arizona time

Contract must contain the full understanding between the parties

Contract must include a clear identification of commitments, deliverables, etc.

Side letters are forbidden

Verbal agreements and other commitments that have not been approved are forbidden

Next month we will take a look at rule #2, or the Delivery has Occurred component.

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PAGE 2 JDA REVENEWS

“Ask any racer, any real

racer. It doesn't matter if you

win by an inch or a mile;

winning's winning.”

From the movie “Fast & Furious”

Jimmy Shkalla, Accounting Manager for EMEA, oversees the day to day operations for G/L,

A/R, A/P and Payroll teams. He also manages the internal audit and SOX requirements,

regional cash forecasts, and month end closing activities for the EMEA region.

How long have you been with JDA? I joined JDA in November 2003 as a temporary and

have been here since then. This was also my first job after moving here to the UK.

Birthplace? Albania

Education? BSC Accounting and Finance, Diploma in Business Management and currently

completing my CPA through ACCA

Family: Married and have two children, son Zak 6 years old, and daughter Alexa 18 months

old.

How did you get in to the Accounting profession? My first job had nothing to do with

Accounting. I started my career as a production engineer at a local TV station. My first

Accounting job was with CARE International in 2000, as part of their Kosovo mission – this is

where I got my first taste of accounting, which triggered my decision to further my studies in

Accounting & Finance at London University.

What book are you currently reading? Financial Performance Management, as part of my

CPA studies.

What is your all time favorite movie? Fast & Furious 1 to 5

Current Ipod Download? I don’t own one.

One thing most people don’t know about me? My real name is Ndircim, but since most of my

colleagues couldn’t pronounce it, I took on the Jimmy name which is close to my Albanian

short name, or Cimi. I also like car racing and do a few tracks in my favorite car, BMW M3

Favorite Travel Spot? Albanian Riviera, I go there every year.

When I am not at JDA I am? Enjoying quite a busy family life taking kids to the movies and

weekly birthday party invites. In the evenings, I enjoy watching movies when I am able to

tear away from my studies.

Recognizing Revenue Performers – Jimmy Shkalla, JDA

Accounting Manager, Bracknell, United Kingdom

Jimmy Shkalla, JDA Accounting Manager

.

Billing generation and accuracy of our invoices is one of the most critical components in the contract to cash cycle. Check out the volume of

invoices we generated by Revenue Stream in Q2 2011; so roughly 6800 invoices vs. 6100 in Q2 2010 with three less (open) resources in the Billing

Group. A big kudos to Ruth Bowman and the Billing Team for pulling this feat together during one of the busiest contract cycles in JDA history!

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2,000

3,000

License Maint. Services Training Hosting Hardware OtherQ2-2011 952 2,266 2,792 118 21 528 127

# of Invoice by Line Of Business

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PAGE 3 JDA REVENEWS

JDA’s Billing Team welcomes two new faces, Jay Pappas, and Allyson Barton.

Originally from Columbus, Ohio, Jay moved to the Phoenix area from Lexington,

Kentucky a little bit over a month ago with his significant other of 13 years. Jay

brings us fourteen years of experience in various areas of accounting, customer

service, collections, and Accounts Receivable outsourcing – the last four years as

a Financial Analyst and A/R Lead with Lexmark International. Some of his

achievements at Lexmark included DSO reduction initiatives, SAP Super User

designee, and Team Lead for Lexmark’s SAP successful A/R rollout in Cebu,

Philippines.

In his current role Jay will be working in the contract billings area reporting to Paula

Hickman within Ruth Bowman’s Billing Team.

In his spare time, Jay enjoys being a Big Brother, is an avid college football fan

(Ohio State & Nebraska Cornhuskers), and teaches gymnastics.

Allyson Barton joins us from Expiris (formerly known as Comsys) where she began

her career as an administrative assistant, and then moved her way throughout the

organization in various capacities of client and contract service roles. She brings

over eight years of professional experience, the most recent of which included

billing and account management for a portfolio of 300-600+ client engagements.

Allyson has her Bachelor’s of Science in Computer and Digital Forensics which she

earned from Champlain College in Burlington, Vermont in May 2009.

She is a single mom to Donovan, 6 years old, and enjoys dance and performing

arts, creative writing, movies, and spending time with her son. She’s also a sports

fan, particularly college basketball and football, as well as NBA, NFL, and NHL. Her

absolute favorite team is Notre Dame.

In her new role at JDA, Allyson joins us as a Contracts Billing Specialist entering and

maintaining software maintenance agreements, also reporting to Paula Hickman.

Welcome, Jay and Allyson, to the Revenue Team and JDA family!

Allyson Barton, Billing Specialist Jay Pappas, Billing Specialist

JDA Welcomes A Day in the Life of Cash Have you ever wondered how clients send

money to JDA, or what happens once the

money is received? Well through this short

narrative we can take you through a day in the

life of JDA’s money.

First you should know that JDA accepts

payment through a variety of means. We

accept Credit Card Payments made with a

Visa, MasterCard or an American Express (sorry

to all the Discover Card users out there). We

also accept payment via Check, Wire, and

ACH (Automated Clearing House). JDA has

several banking institutions throughout the

globe, but for the purposes of this article let’s

just say the most payment traffic is received in

our Wells Fargo Bank.

Checks can be sent to JDA’s Worldwide

Headquarters, or to our Lockbox location in

Dallas Texas. Once payment has “Cleared” our

banking institution, it is available for viewing on

one of our daily transaction record reports.

These reports contain all the information that

was sent by the client to the bank, which is then

used by our Accounts Receivable team to

determine which invoices each client is paying.

Once each payment has been tied to the

proper invoice(s), the AR team creates a

deposit worksheet in JDA’s internal accounting

system (PeopleSoft) which applies the funds we

have received. Let’s just say that creating the worksheets can be quite a daunting task. With

the multitude of banks and various payment

methods we accept, it is possible for the AR

team to create almost 10 per day. After the

worksheets are balanced, they are batched for

posting to the AR module in PeopleSoft (then

the fun really begins). Once all payments have

been posted, each AR associate runs a

“Payment Detail” report that outlines all the

payments they have processed for the day.

This report, along with all of the details from the

banking institution is then scanned and filed into

both a secure drive and a file room.

The key to our cash life cycle is to apply funds

quickly and accurately which allows our

collections team to have a very clear snap shot

of a customer’s account enabling them to

begin the collection recovery process.

Tip of the Month: A question often asked is what is DSO, why is it relevant, and how is it calculated?

DSO, or Days Sales Outstanding is a measure of how quickly cash is recovered within standard terms and is an important

gauge of the overall health of Accounts Receivable and an important component to cash flow. It is calculated as such:

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PAGE 4 JDA REVENEWS

As Manager of the Revenue Accounting Team, my role is to oversee the overall activities for the Project

Accountants, Project Services Group (PSG), and the Maintenance Team. Customer Service to the field is a top priority

for all of my team members, and we are willing and prepared to support our JDA partners with any questions or issues

as they relate to the three areas discussed below.

The Project Accountants handle all of the Statements of Work (SOW’s) and provide the support to the Services

side of a contract. For Fixed Bids and Milestone Projects (including Time & Expense with caps), they work with the Billing

Department to ensure billings are timely and accurate based on the SOW at hand. This includes updating invoices for

special handling or system issues, as well as removing “Billing Holds”.

In addition, they prepare your (field) Fixed Bid Templates which entails auditing, calculating revenue

percentages by completion or milestone, and booking the revenue in the G/L to ensure the project is not in any loss or

revenue recognition jeopardy. Lastly, this group is also responsible for entering forecast revenues based on Project

Manager forecast entries in to JTRAX.

Our Project Services Group (PSG) facilitate the JTRAX and Accounting interface. This includes ongoing

communication with all internal and external departments throughout JDA worldwide. This includes transitioning

department structural changes, assignment overhead projects for associates, cross charge requests, and creation of

all Sales and Pre-Sales requests. The PSG group also creates and supports all Implementation Support, Support

Services, Education Services and Development Projects as needed.

Lastly, the Maintenance Team’s responsibilities include analyzing Maintenance Revenue and ensuring revenue

is correctly set up in our Billing system. This group also works very closely with the Accounts Receivable Team and

Global Support Services (GSS) to identify A/R that is under potential suspension, and generate suspension report details

to the GSS and FP&A Teams for forecasting purposes.

We are committed to answering any questions, issues, or feedback you may have concerning our support to

the field. Also, within this newsletter there is a Revenue Matrix link which will provide you with escalation points, should

you need to raise any issues we may not be addressing in a timely manner.

Revenue Accounting Team – A Look Inside, by Tammy Cunha

Adam Ahrens, Kim Mujic – PSG

Debbie Adame, Katie Berling, Christi Hall –

Project Accounting

Lisa Bear, Brian Dragos – Maintenance Team

Tammy Cunha – Revenue Accounting Manager

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PAGE 6 JDA REVENEWS

Cash & DSO

O

Our cash target of $175MM for Q2 was exceeded by roughly $4MM with total receipts for the quarter totaling $179.8MM. DSO

for June and ending Q2 registered at 71 days which represents a 13 day increase over prior month and a 5 day increase over

the same time last year. DSO’s increased throughout all regions, with the the largest impact felt in Latin America and ASPAC.

Below is the Cash Forecast & Targeted Receipts chart, along with the Regional DSO chart for last trailing three years.

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Apr May Jun Q2 Cash Rec'dAMERICAS EMEA ASPAC Q2 Cash Target

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Regional DSOs

North America Latin America Europe AsPac

Escalation Process & Revenue Team Matrix

O

Escalation is an important tool, particularly when the field has not received a response within the established Service Level

Agreements (SLA’s) for each of the individual areas of the Revenue Team. To address this, the Revenue Team has developed

a comprehensive Revenue Accounting Support Team Matrix which is available to you in the following Accounting Link in JNet,

http://jnet.jda.corp.local/DocCenter/Acct/Accounting%20Contacts/Forms/AllItems.aspx.

The Matrix will provide you with the “go to” individuals for each area of the Revenue Team, with the additional escalation

point persons for those respective areas.

We encourage you to use this matrix when contacting any member of the Revenue Team. If and when an escalation is

required, please make sure to contact the next escalation person identified in the matrix. This protocol will allow us to respond

to your questions and issues in a consistent and timely manner. Bear in mind that escalating issues outside of the Revenue

Matrix will typically compound response times and delays, as the issue ends up filtering through multiple layers of

management.

We appreciate your adherence to the Matrix, and trust it will be a useful tool to each of you.