Revenue Recognition

Revenue Recognition in SaaS pertains to the accounting principles that determine when and how revenue is recorded. Due to the subscription-based nature of SaaS, revenue is typically recognized over the period the service is delivered, rather than at the point of sale.

Accurate revenue recognition is essential for financial reporting, compliance, and providing stakeholders with a true picture of the company's financial health. It often involves adhering to standards like ASC 606 or IFRS 15.