Synder can do revenue recognition for your subscription payments with the “Revenue recognition” add-on. When the revenue recognition feature is enabled, Synder will sync all the subscription-related invoices to Deferred Revenue. At the end of the month, it will generate an entry to recognize the revenue according to schedules.
Overview:
Revenue recognition flow in Summary Sync
The invoices coming into Summary Sync will be viewed by the app differently: as either recurring or one-off invoices.
Recurring invoices are:
- The invoices uploaded into the revenue recognition module via Excel.
- The invoices from external provider (e.g. Stripe) linked to the subscription.
One-off invoices are:
Stripe invoices not linked to the subscriptions.
You can visually differentiate Stripe one-off and recurring invoices in ‘Summaries’ → ‘Transaction list’ tab → Payment platform in the following way:
– Stripe logo will indicate for one-off invoices.
– Synder logo will mark invoices that have gone through revenue recognition.
Recurring invoices (refunds linked to those invoices) will affect Accounts Receivable (debit) and Deferred Revenue (credit) accounts.
One-off invoices (refunds linked to those invoices) will affect Accounts Receivable (debit) and Sales (credit) accounts.
So once the Sales Summary for the day is finalized, you will see recurring invoices going to Deferred Revenue. The Sales Summary will include all the Stripe data for the day.
At the end of the month, Synder will generate a Recognition Summary. It will move the amounts from Deferred Revenue (Balance Sheet) to Income accounts (Profit and Loss) according to your mapping.
How to reconcile Recognition Summary
The Recognition Summaries will be labeled with Synder logo and will look somewhat like this:
The Recognition Summary is going to have all the revenue recognition details for a month.
You can always click on the “Download the raw data” button to download a report file for the recognition summary and see all the amounts on the per item level, which will support the numbers in the summary.
To reconcile, go to the Recognized revenue for the month and compare the Recognition Summary total to the Overview report.
Note: In the example shown in screenshot 2, Stripe accounts are connected to Synder, resulting in two Recognition Summaries being generated at the end of the month. If this applies to you, sum them up and compare the totals.
Important note: The revenue recognition module will NOT affect the reconciliation of the Clearing account. This module only deals with invoice amounts, reflecting them in the Deferred Revenue account instead of the Income account. At the end of each month, journal entries transfer these amounts to the Income account according to the recognition schedule.
Reach out to the Synder Team via online support chat, phone, or email with any questions you have – we’re always happy to help you!