Stripe wants to make financial reporting less painful for SaaS companies

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Stripe has unveiled a new financial reporting tool designed to simplify a key aspect of accounting processes that save SaaS companies time.

Its new revenue recognition tool was designed in such a way that it can automate many facets of revenue recognition, including when a customer receives or uses a product, as opposed to when they paid for it.

This decision will help more effectively document customer behavior, particularly with respect to revenue recognition, which is a central part of generally accepted accounting principles or GAAP.

Revenue recognition has long been a complex and difficult prospect for many businesses, especially those that operate recurring or subscription-based revenue agreements. Traditionally, revenue recognition has been a largely manual process whereby finance staff previously had to record details through an Excel spreadsheet.

Revenue recognition

Stripe’s new revenue recognition tool is expected to help reduce a lot of manual intervention by providing automated income statements and revenue cascade tables.

Likewise, automatic processing will record all transactions and the system can even be used to import non-Stripe transactions, further smoothing the revenue recognition process. Importantly, there is support for compliance, so companies don’t have to worry about meeting common standards, including ASC 606 and IFRS 15.

Another tool in Stripe’s growing product portfolio is the new revenue recognition tool. Businesses can also use Stripe Tax, its tax compliance tool, as well as Stripe Identity, which helps business owners more closely monitor identity verification.

Stripe announced the latest launch yesterday and has already made the product available in over 40 countries around the world.

Going through: ZDNet


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