Synder can completely automate revenue recognition for subscription-based businesses that manage their subscriptions in Stripe. You can learn more about the recognition flow in this guide.
Below are the setup steps you need to go through in order to enable revenue recognition in Synder:
1. Contact support to request Revenue Recognition for your account and schedule a call. On a scheduled call, our specialists will discuss the RevRec flow and most importantly, will identify with you:
- What is your revenue recognition start date?
- What is the revenue recognition calculation method you prefer?
- How would you like the data to hit your books (as a single entry or per subscription)?
- How would you like to process discounts in revenue recognition?
- Other case-specific questions
Note: It is important to figure out all the details on this call, as revenue recognition for subscription businesses is highly dependent on history, so changing the setup later once the data is imported may be problematic.
2. Once the feature is enabled, you will see an additional “Revenue Recognition” tab in your left-hand menu in Synder.
- Subscriptions tab will list all subscriptions imported from Stripe
- Overview tab will provide reporting on revenue recognition
- Configurations tab includes mapping and other settings of RevRec
3. You will see the recognition schedule built for every subscription based on the billing periods from Stripe.
Note: Any change in Stripe will update the schedule within an hour, so there is nothing you need to do manually to keep up with the subscription changes.
4. Before you can sync data to your books, you need to map the list of product prices from Stripe to QBO product(s) and QBO income accounts.
- Create the needed products in your QuickBooks (or just use already existing ones, if you have them ready).
Important: The products you are going to use for revenue recognition should be mapped to the “Deferred Revenue” account, which should be classified under liability accounts, in QuickBooks. Also, ensure that you create the “Deferred Revenue” account in the Chart of Accounts if it does not already exist.
- Make sure the products you set up and map for RevRec will not be used for regular invoices (as this will mess up the deferred revenue!). We recommend creating unique product(s) that will be mapped in the RevRec mapping and used exclusively for RevRec.
- Create a product for a discount (as discounts will be recognized across the billing period as well, it will be synced as a product in the invoice). Deferred Revenue should be used as an Income account for it as well.
- Once you have everything ready on the QBO end, Go to Synder → Revenue Recognition → Configurations, map your created products under the “Accounting product name” column and your Income accounts under the “Income account” column.
- Click Update to save the mapping.
- Once you are done with the mapping, you can go to the Platform Transactions tab and sync your revenue recognition transactions to the books!
Note: You will see another “payment provider”, which will indicate all the “Revenue Recognition” transactions for each of your connected Stripe accounts. You will see subscription invoices, refunds, and Journal Entries under this provider.
Once you have tested out revenue recognition, feel free to enable auto synchronization for it and enjoy completely automated recognition of your revenue!
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!