Post on 20-Jan-2017
transcript
Ask, Share, Learn – Within the Largest Community of Corporate Finance Professionals
Revenue Recognition Policy Best Practices for Increasingly Complex Business Models
Proformative Event Notes
• The slides are available under “Handouts.”
• We will send you links via email to the presentation and the recording within 24 hrs.
• For CPE: Answer all polling questions and remain for the duration. CPE Credits awarded in 24 hours. – Questions on CPE? Email cpe@proformative.com.
• We want to hear from you! Ask questions for the Q&A session at the end of the event.
• Please take the short survey at the end of the webinar.
Welcome to Proformative
• Proformative Academy - over 250 on-demand courses • Proformative Community - over 10,000 discussions • Proformative Webinars – over 200 topical webinars per year • CFO Dimensions Conference
“Proforma(ve is the leading professional development resource for every member of the Office of the CFO”
Want to learn more? Tell us on your survey!
Ask, Share, Learn – Within the Largest Community of Corporate Finance Professionals
Revenue Recognition Policy Best Practices for Increasingly Complex Business Models Mike Murphy, CPA, Chief Business Officer, goTransverse
7
Recognizing revenue used to be simple
Produce widget Recognize revenue when you sell it
Revenue
Sell it
8
Old Economy
• Sell Widget • Recognize Revenue
SOFTWARE = Disrup(on
• Dynamically priced
• Lots of ways to package, price
New Economy
• Accountants try to align old standards (97-‐2)
• Taking old ways and applying them to new economy didn’t work
• Migration to new kinds of product offerings
• Constantly having to rewrite rules
13
Offer • Pricing • Delivery
Contract • Customer terms
• Billing
Sales • Channel • Direct • Online
Everything starts with GTM
14
Recognize revenue when performance obligaNons are met
Allocate transacNon price to performance obligaNons
Determine transacNon price
IdenNfy the performance obligaNons in the contract
IdenNfy tangible contracts with a customer
5 Steps to Successfully Recognizing Rev
18
allocaNon = cookie cuQer
support
soRware services Allocate
transaction price to performance obligations
22
SALES GUY:
• “I’ve got this guy who wants to do a deal.”
• “But we don’t own that car.”
Image by sonnyandsandy on flickr
23
• Address random sales behavior through: – Sales compensation plan – Focused leadership team – Automation of order-to-cash cycle
Your best-laid revenue recognition plans will be defeated by the random sales act.
• Thanks to our speaker
• Join us at www.proformative.com to continue the conversation with your peers in our community
• If you want an introduction to today’s speaker or sponsor, or want to know more about Proformative Academy or CFO Dimensions, tell us on the survey!
A Few Final Items