As a company that works to customer orders and with a growing number of customers, you work with a large and varied range of long-term contracts. All of these contracts have their own specific stipulations, conditions, payment agreements, and payment instalments. In your financial administration department, some of your employees are constantly occupied with sifting through all of the contracts to ensure that all of the turnover is correctly entered into the books and that the (quarterly) reports are in order. Your revenue recognition is a source of worry that continuously demands your attention. Check, check, and check again.
You have already been forced to deal with misjudged contract conditions and even a case when mistakes were made in the currency conversion calculations – errors that were only discovered at a very late stage. You were forced to adjust the figures downwards, and that caused a great deal of trouble. Luckily, the papers didn’t get hold of it, but revenue recognition is still a major concern. And it costs a lot in staffing too...
With Sofon, you will have no more worries about revenue recognition. As soon as a quote is confirmed as a contract, all stipulations, conditions, and payment and billing agreements, deposits, advance payments, payment instalments, discounts, and so on will automatically be translated into the correct turnover figures for your revenue recognition. Finance will no longer be required to examine every contract in minute detail, arduously gleaning snippets of information from them, or carry out extra registration work to find out when to send the bills.
On the contrary: just one click of a button is all you will need to generate a schedule that provides an overview for the contract in question, indicating what sums can already be recorded as turnover. The schedule can also be read into another system if required. This will make your revenue recognition infinitely easier and it’s much less time-consuming. And, even more importantly, you will know that your revenue recognition balances with every contract that you conclude, so you won’t have any discussion with your accountant about the turnover that you reported to him or her.
As an addition to your revenue recognition, you can improve other aspects of quoting and contracting by introducing smart processes: quote creation, quote management, cost of goods sold, sales negotiation management, discount/rebate management, contract creation, contract management, authorization and approval and revision and version management.