ADR 0002 — Contracts from promises; invoices are billing

Date: 2026-07-29
Status: Accepted
Deciders: RevRec redesign working session

Context

Today’s Hotglue path often reconstructs order/PO lines by joining invoices to subscription/contract terms (merge_asof and related). That is not required by ASC 606; it conflates billing with performance obligations.

Decision

• Contracts / POs open and amend from subscription, contract terms, catalog (and later CPQ) — i.e. promised goods/services.
• Invoices / CNs / payments are record_billing / record_credit / record_payment events.
• Credit notes and modifications are named policies, not join heuristics.
• Invoice-driven OrderDetails invention is not the architecture of RevRec Next.

Consequences

• Event catalog and engine scenarios are structured around apply API operations.
• Thin engine (single PO ratable) can ship without reconstruction ETL.
• Legacy reconstruction logic may remain as a temporary compatibility path during migration only.

Alternatives considered

1. Keep invoice-asof reconstruction as the core contract creator — rejected.
2. Hybrid forever (always invent orders from invoices) — rejected as default; may exist only as a compatibility mode if product demands it (would need its own ADR).