Procure to pay, order to cash, record to report, controllership processes, finance transformation. Do these sound familiar? And do these processes involve predictable manual work, as well as large data to be processed and collected? As the answer is likely to be yes to both these questions, you are probably aware of the headaches they produce. As for the solution? Robotic Process Automation (RPA) is estimated to have a global potential of 44% in Finance and Accounting. With proven results for many front runner companies, RPA is guaranteed to smoothen the way business operations are managed.
BTerrell Group Blog
Back in April of 2010, the Financial Accounting Standards Board published new accounting guidance for calculating an often challenging method for recognizing payments on certain forms of revenue. Published as “ASU 2010-17: Revenue Recognition – Milestone Method (Topic 605)”, and discussed in draft abstract form in “EITF 08-9: Milestone Method of Revenue Recognition” on RevenueRecognition.com, the method allows vendors to recognize revenue at the time that a contractual obligation has been fulfilled, instead of applying revenues systematically throughout the term of the contract. However, because of the complexity of dealing with contractual incentives, such as bonuses, the milestone method outlines a few criteria that must be met.
One of the key points in this methodology is that a milestone must be an event for which there could be ‘substantive’ uncertainty for achieving this event at the time of contract signing. Although ‘substantive’ is a key word in this process, it still involves a matter of judgement considering either the vendor’s performance to achieve the milestone or the added value of the delivered item or service resulting from the achievement of the milestone. Most businesses may have some projects that may fit into this method of revenue recognition, and others that don’t. As such, an agile financial management solution that can manage variable revenue recognition models can help clarify and streamline these efforts. Contact BTerrell Group for more guidance with identifying and managing varying revenue recognition models. And, if you are concerned about the transition year difficulties imposed byASC 606 – Revenue from Contracts With Customers, we can help you get ahead of the game there, as well!
Like many accounting and financial technology professionals, I am busy getting up to speed on best implementation practices for ASC 606, Revenue from Contracts with Customers. ASC 606 takes full effect for both public and private companies within the next several years, and applying the new guidance won’t easily happen without adequate planning and effort. Here are highlights to consider thus far.
First, adoption will not be trivial: ASC 606 replaces scores of individual provisions in existing GAAP, and the cost of delaying implementation or trying to correct mistakes later could get scary. Start now, identify crucial differences between existing GAAP and the new guidance, designate an implementation champion, develop a project plan and educate key stakeholders.
Brian Terrell visits with host Ed Kless on the Sage Advice Podcast about software automation, Artificial Intelligence, and Robotic Process Automation (RPA). The BTerrell Group assists small and midsize businesses automate internal business processes using Sage Software and automation tools, including RPA.
"I help the back offices of small and medium sizes business accomplish more work but work less," he tells Ed in this 11 minute interview. "It delights me when my clients' eyes light up when I share a faster or newer or more accurate way to help them with their finance or accounting assignments."
I’ve been writing a lot lately about the new revenue recognition standards (created by ASC 606 and IFRS 15) companies will soon need to adopt to ensure compliance. Granted, it’s a complex and somewhat dry topic, but it’s one poised to have a tremendous impact on public and private companies alike. Since most of us aren’t accountants (full disclosure – I am, but not practicing), I thought it could be helpful to boil down the changes to the five core steps to compliance.