Revenue Recognition for Subscription Businesses

Focus on subscription business growth with Softrax integration

For some subscription-based businesses, revenue recognition can be a relatively straightforward process that can be completed effectively using spreadsheets. However, recent changes sometimes require more sophisticated revenue recognition capabilities:

1. Solve increasingly complex subscription models

Subscription businesses that once offered simple pricing models ($9.99 per month, for example) are now finding that they need to offer more complex pricing to meet consumer demand. Take subscription boxes, for example. Today's subscribers expect to return any item in the box and receive credit. However, the merchant will not know how much revenue to recognize until after the subscriber has indicated which items they plan to keep.

2. Meet the new ASC 606 / IFRS 15 accounting requirements

The new revenue recognition standards issued by the Financial Accounting Standards Board (FASB) and the International Accounting Standards Board (IASB) – known as ASC 606 / IFRS 15 – have introduced changes to revenue recognition procedures, as well as a requirement for dual reporting.

Vindicia simplifies revenue recognition with Softrax integration 

We have integrated our solution with Softrax, the industry leader in revenue management software. This integration with Vindicia's subscription business platform enables our clients to fully comply with new ASC 606 / IFRS 15 accounting and revenue recognition requirements, while simplifying ongoing financial compliance and reporting. The integration makes complex manual manipulations and expensive enterprise resource planning (ERP) customizations a thing of the past.

Our Softrax integration offers a full range of capabilities that make it quick and easy to configure, deploy and integrate with existing systems and ERP, including:

• Full support for ASC-606 / IFRS 15 – including comparison of revenue as processed under the old and new guidance (ASC 605 vs. 606) in support of the dual reporting requirements
• Multiple revenue policies (multi-book accounting) – compare budget to actuals to pipeline and projected revenues and costs
• Policy configuration – robust template maps, override options and point-and-click configurations remove the need for logic in the integration layer, expediting and simplifying implementation
• Reporting and dashboards supported by an advanced business intelligence engine offering advanced drill-down, filtering, and more
• Configuration of multi-stage approvals
• Chart of accounts that tracks the deferral and recognition of revenue
• Flexible accounting calendar

Thanks to the Vindicia/Softrax integration, subscription businesses can now focus on business goals and growth, rather than back-end accounting complexities.

For more information, read our revenue recognition data sheet. For more on ASC-606 / IFRS 15, read the new white paper from the financial experts at Proformative. And view our infographic.