What is a Revenue Recognition Policy? A revenue recognition policy is a single document which summarizes your processes and methodologies used to recognize revenue. Download our free revenue recognition policy template and say goodbye to rev rec headaches this audit season.”

How do you project revenues in a SaaS or subscription business? To generate revenue projections or a revenue forecast, you must incorporate three revenue projections from at least different revenue sources: SaaS revenues from existing contracts SaaS revenue projections from renewal contracts SaaS revenue projections from new contracts (new sales/contracts) SaaS Revenue from Existing Contracts…

Revenue Recognition for SaaS and/or Term Subscription Businesses Revenue Recognition, commonly referred to as rev rec or revenue rec, is an accounting principle and a process for reporting revenues by recognizing the monetary value of a transaction or contract over a period of time as the revenue is “earned.” The method of allocation and the…

Customer Revenue Definition for SaaS Customer Revenue is the revenue associated with the customer or customer contract. When someone refers to Customer Revenue, he or she could be referring to any number of different revenue numbers: reportable annual GAAP revenue, ARR, Customer Lifetime Revenue, even Customer Lifetime Value. In a subscription business, the type of…

What is deferred revenue in a SaaS or subscription business? Revenue Recognition, commonly referred to as rev rec or revenue rec, is an accounting principle and a process for reporting revenues by recognizing the monetary value of a transaction or contract over a period of time as the revenue is “earned.” The method of allocation…

Revenue Backlog Defined Revenue backlog is the value of contracted revenue that has yet to be recognized in your SaaS or subscription agreement. While Revenue backlog can occur in traditional and subscription businesses, the accrual nature of revenue recognition in subscription models results in almost all subscription companies having revenue backlog. How do you calculate backlog? Revenue Backlog…