by Jim Powers, Senior Manager, InnoVergent Client Services

By now, you likely know that new standards for Revenue Recognition have been issued by the FASB. These new standards need to be implemented no later than the quarter and year beginning January 1, 2018 for public entities with a calendar year end. For all other entities with a calendar year end, implementation must occur no later then the year ending December 31, 2018.

So how should you be preparing? Take a look at the key tools that will help your organization get started.

Navigating Revenue Recognition with InnoVergent

InnoVergent, using Oracle | NetSuite software named Advance Revenue Management (ARM), will guide you in designing Advanced Revenue Management and successfully implementing the new standard. The standards are complex, but we will work with you in designing your unique revenue recognition requirements that comply with the new standards.

Oracle | NetSuite has developed Advanced Revenue Management (ARM) that provides a solution to streamline revenue accounting functions to ensure compliance with current and future FASB and IFRS guidelines, ASC 605, ASC 606, and IFRS 15 Standards.

What is Advanced Revenue Management?

Advanced Revenue Management (ARM) is developed using the five steps necessary for the new revenue recognition standards:

  1. Identify the contract with a customer
  2. Identify the performance obligation in the contract
  3. Determine the transaction price
  4. Allocate the transaction price for the performance obligations
  5. Recognize revenue when (or as) the entity satisfies a performance obligation

These steps are achieved through the ARM Components:

  1. Setup and configuration
  2. Order management and billing
  3. Revenue allocations, planning, and recognition
  4. Comprehensive real-time reporting

Depending on your business model, the new Revenue Recognition Standard can affect your company differently. For more information on the new Revenue Recognition Standard and how InnoVergent can help you navigate the changes, contact us at info@innovergent.com.