Recognizing revenue with Replicon

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  • Updated 2 years ago
  • (Edited)
All companies need to account for the revenue they earn, to determine and report on their financial health, to communicate their status to investors and shareholders, and to create accurate revenue forecasts.

Traditionally, professional services companies have done their own thing, creating ad hoc methods of determining when revenue is recognizable (i.e. ‘real’). For example, some might recognize revenue when a deal is signed, while others might wait until they have payment in hand.

But this made it difficult for analysts to really understand a company’s financial state or compare it to other organizations’, since the reported revenue could be based on anything.

Enter IFRS 15 and ASC 606 – equivalent international revenue recognition standards that are currently coming into effect. With these new standards, regulators aim to eliminate industry-specific reporting methods. And if professional services companies fail to comply with the new standards, they face penalties.

Now, if you’re like a lot of companies, you rely on a franken-system for revenue recognition – ad hoc contracts, multiple tools and manual systems that are prone to errors, and static workflows that don’t allow you to easily incorporate your real-time work progress.

If this is your reality, how can you feel secure in your ability to comply with anything?  

That’s where we come in.

Very soon, Replicon will be launching a Revenue Workbench that will be available to our Professional Services Automation customers.

Out of the box, it will include a Percent of Completion contract you can use to comply with the new revenue recognition standards.

But, if for some reason the defaults don’t match your needs, our platform allows us to easily add custom rules that reflect exactly how your organization recognizes revenue.

So, if you’re in the market for an automated, unified revenue recognition system that lets you painlessly:

  • Comply with international regulations

  • Reconcile your revenue with contracts, with billing, and with the projects you’re currently working on

  • Visualize a project’s revenue status in real-time, and

  • Generate accurate revenue forecasts

Then stay tuned.
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Paula Tannahill, Technical Writer

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Posted 2 years ago

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