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Unearned Revenue: What it is and What it Means for Subscription Businesses

Stax

The concept of unearned revenue can easily trip up SaaS companies that offer subscription services and products on a recurring basis. Unlike when selling ordinary products, you cannot recognize the revenue earned from a subscription all at once. This is important for subscription businesses due to recurring advance payments.

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Understanding Deferred Revenue and Its Impact on Your SaaS Business

Subscription Flow

Deferred revenue refers to the income that you have collected, but not yet earned. The GAAP (Generally Accepted Accounting Principles) issued by the FASB (Financial Accounting Standards Board), inform businesses when their revenue should be recognized. This is where the concept of deferred revenue comes in.

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How We Run Finance & Operations with Two People at ChartMogul

Chart Mogul

With only 2 people on our Finance & Operations team, we have to be smart about how we use our resources. Finance & Operations. The Finance & Operations Team at ChartMogul. She’s been with ChartMogul for almost a year now and has helped us a lot to improve & document our reporting and other processes.

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5 Things to Know About Accruals

SaaSOptics

It’s a financial practice used in businesses with revenue timelines that would otherwise be delayed. Revenue accrual is commonplace in the service industry, because these projects can take months—or years—to complete. Revenue accrual is a crucial practice in situations like these. How Do You Calculate Revenue Accrual?

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SaaS Revenue Recognition: Demystifying The Concept of “Earned” Money

Subscription Flow

The idea that a company generates revenue at the time it receives cash is far outdated. Even more so for the businesses in the Software-as-a-Service industry. Instead, the accrual accounting principle known as “revenue recognition” is now under the spotlight. Why does the cash-based accounting lag behind?

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SaaS Metrics Refresher #7: Revenue Recognition

Chart Mogul

In this week's lesson, we're tackling the tricky process of converting bookings into revenue — also known as revenue recognition. Repeat after me: cash is not revenue! For a SaaS or subscription business, revenue recognition can be complex, mainly because of the service-oriented nature of the product.

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The complete guide to SaaS revenue recognition with ASC 606

Chart Mogul

ASC 606 and its sister standard IFRS 15 bring a set of structured guidelines for recognizing revenue -- here's what every SaaS business needs to know to meet the deadline and get compliant. Cash is not revenue. The new reporting framework applies to any situation where there is a contract for goods and services.