Cn285 manages the revenue recognition (RevRec)
associated with recurring contracts
Accounting for a subscription to a SaaS service
Your service is materialized by a delivery on a fixed date or by an access available throughout the subscription period (month). Your service periods are from date to date or are based on the calendar period (calendar month, calendar quarter, calendar year)
it is invoiced "up front" at the beginning of the period, or at the end of the period... thus generating invoices to be issued or deferred revenue
There are a number of rules for accounting for subscription revenues associated with these different scenarios. The choice of whether to bill on an ongoing basis or at the end of the month is structuring. This has implications for:
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the revenue recognition rules to be applied
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the billing system and the underlying technical architecture.
Choosing to bill from date to date allows you to smooth out the billing load over the entire month.
Conversely, month-end billing concentrates the data processing and invoice production effort on a limited period. On the other hand, "end of month" invoicing avoids the application of revenue recognition rules.
Synchronization of accounting entries
In the case of an architecture where Cn285 generates invoicing elements and transmits them to an ERP, Cn285 allows :
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Generate the sales journal
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Generate revenue recognition entries (RevRec entries)
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Generate entry summary logs
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Synchronize with the ERP the accounting entries aggregated according to different axes thanks to its XSync synchronization engine.
IFRS standards
IFRS 15, IFRS 16 and ASC 606 have had a major impact on revenue recognition rules.
The principle of recognizing revenue when goods or services are transferred to the customer on a one-time (delivery) or smoothed (continuous service) basis has accounting implications.
Depending on the UseCases, Cn285 can provide the accounting system with REVREC's sales journal and OD details or an aggregation based on different axes.
Cn285 has special case management options (Not generating an invoice to issue at contract signing but at the first service period).
