What challenges are addressed with the Revenue Recognition Engine?
Whichever way you choose to apply the new revenue recognition standard, there will be wider implications for your finance operations. These may include:
- Collecting raw input data at a contract by contract level of granularity (regardless of a contract or portfolio approach)
- Justifying new accounting outputs which will require detailed traceability throughout the finance environment and therefore absolute data integrity from source to post
- Processing the sheer number of calculations required
- The flexibility to account for innovative offers and products
- Accommodating the current finance IT architecture and making the most of previous technology investments
The challenge of IFRS 15 is not simply in defining new rules to report revenue correctly, but in ensuring that your finance system is robust enough to cope with an increasing amount of accounting change while delivering transparency to all stakeholders.
“We had to think about how we were going to address new marketing offers and products in a way that didn’t stall innovation. Furthermore, we have to add value by validating the revenue profile of products over their life cycles and ensure they are correctly accounted for over the life of the offer.”
-Finance Executive, Large US Telco