What to Know about Standalone Selling Price for SaaS Companies
The ASC 606 / IFRS 15 revenue recognition standard can be complicated for technology companies, especially for those with Software as a Service (SaaS) offerings. The business model of SaaS companies can often trigger the need to follow a number of complex components of the ASC 606 / IFRS 15 guidance. For those companies selling […]
Consumption billing can force SaaS companies to conform to the variable consideration guidance in ASC 606
Consumption, or usage-based, billing models charge customers based on the quantity or usage of a product or service. The model has become increasingly popular in the SaaS business environment, where the rise in consumption billing is a natural next step after adoption of basic fixed-fee, subscription billing. Currently about 90% of public SaaS companies have subscription-based […]
Where are the Auditors: ASC 606 and Recognizing Subscription Billing Revenue
Since ASC 606 and IFRS 15 have taken effect, auditors, particularly in the private sector, have had a soft touch in enforcing some of the most complex portions of the guidance. Many companies moving to subscription bill models are not even aware these complexities exist. With the rise in comment letters seen in 2022, and […]
IoT, Subscription Billing, and Revenue Recognition
The Internet of Things (IoT) continues its exponential growth, with IoT Analytics estimating that the global number of connected IoT devices will grow by 16% this year, to 16.7 billion active endpoints. And, according to IDC, by 2025 these devices will have generated 73.1 (zettabytes) of data. Many companies clearly have IoT offerings that are […]
Telecommunication and ASC 606: Revenue Recognition Under the New Standard
The telecommunications industry has been grappling with the new levels of complexity presented by the revenue recognition standard, ASC 606. For telecommunications entities, notable challenges include those related to determining performance obligations and transaction prices among other revenue recognition processes.
ASC 606 Revenue Recognition Impacts on Media and Entertainment Companies
The new revenue recognition accounting standard update, ASC 606, issued by the Financial Accounting Standards Board (FASB) has caused significant disruption in the back office. Adoption of the new standard will impact people, policies, processes, and systems. For media and entertainment (M&E) entities that account for revenue under U.S. GAAP, it raises several accounting issues.
ASC 606 Impact on Construction Company Revenue Recognition
Should revenue be recognized at a point in time or over time following the new revenue recognition standard for construction companies? The new revenue recognition financial accounting standard, ASU 2014-09, Revenue from Contracts with Customers (“ASC 606”) has created significant complications across industries, and these sweeping changes to revenue recognition guidance have often had far-reaching […]
5 Reasons Why You Should Stop Using Excel in Revenue Recognition Part Six: Excel is not a Reporting Tool
Beginning in January, we posted a blog outlining five important reasons why Excel spreadsheets were not to be trusted for implementation of the ASC 606 guidelines. Since then, we have extended that blog post into a series devoted to the topic of Excel, focusing each post on one of the five reasons. This month’s FINALE: “Excel is not a […]
5 Reasons Why You Should Stop Using Excel in Revenue Recognition Part Five: Excel is not an Agile Business Tool
Beginning in January, we posted a blog outlining five important reasons why Excel spreadsheets were not to be trusted for implementation of the ASC 606 guidelines. Since then, we have extended that blog post into a series devoted to the topic of Excel, focusing each post on one of the five reasons. This month’s rally: “Excel is Not an Agile […]
5 Reasons Why You Should Stop Using Excel in Revenue Recognition Part Four: Excel is Not Intended for Sharing
Beginning in January, we posted a blog outlining five important reasons why Excel spreadsheets were not to be trusted for implementation of the ASC 606 guidelines. Since then, we have extended that blog post into a series devoted to the topic of Excel, focusing each post on one of the five reasons. This month’s rally: […]
5 Reasons Why You Should Stop Using Excel in Revenue Recognition Part Three: Excel is Not Secure
In January, we posted a blog outlining five important reasons why Excel spreadsheets were not to be trusted for implementation of the ASC 606 guidelines. Then in March, we struck again, and posted Part Two of the series; the prevalence of errors in Excel Spreadsheets. This month, we’ll refocus your attention on the idea that “Excel […]
Ensure Success in Adhering to ASC 606’s Requirements
In April 2018, WageWorks (a provider of consumer-directed spending solutions and services) announced it would be restating its revenue and net income for two quarters of 2016, full-year 2016, and three quarters of 2017 due to financial control and reporting issues.
SEC Feedback Regarding ASC 606 Adoption
Anyone who has played Monopoly knows that every player wants that “Get Out of Jail Free” card… In real life, though, there are no “Get Out of Jail Free” cards for those adopting ASC 606. However, there has been enough real-world feedback on ASC 606 to provide a potential safe passage past that dreaded “Go […]
Is Your Company Ready for the New Revenue Recognition Exam?
Have you hit the snooze button one too many times on your revenue recognition alarm? It’s every student’s (or accountant’s) nightmare: before you know it, the term has ended, and one of the most important tests of the year (ASC 606 and IFRS 15: Revenue from Contracts with Customers), is here. Your teacher will soon […]
ASC 606 Adoption and Initial Disclosure Requirements
Welcome again to our blog and continuation of the discussion of Disclosures related to the new FASB revenue guidance, ASC 606 – ‘Revenue from Contracts with Customers’. With the effective date of the new guidance upon us, we would expect to see public companies disclose more information about the impact of the guidance prior to […]
What Professional Services Organizations (PSO’s) Need To Do NOW To Prepare For New Revenue Recognition Standards
So the holiday season is just around the corner. Right around the second corner of the New Year, new revenue recognition regulations will be in front of us. Honestly. Really. 2018 is lurking in the hallway and there’s no avoiding it. When talking to professional services organizations on a daily basis, Changepoint’s Director of Product […]
Calculating Time Value of Money (TVM) For Revenue Recognition
The reporting deadlines imposed by the ASC 606 and IFRS 15 standards are fast approaching. That means the time for companies to get serious about implementing the new revenue recognition standards is now. Embedded within the regulations is the concept of a significant financing component, which means for many companies, adopting the new revenue recognition […]
Weathering The Storm: ASC 606 Solutions
To ensure consistent application of rev rec rules, companies need to be armed with a strong internal understanding of how ASC 606 applies to their particular business model. Where internal know-how comes up short, third-party consultants can provide additional expertise – and peace of mind – when assessing the impact of revenue recognition.