Along with helping improve the revenue processes of our customers, Tensoft Revenue Recognition Management (RRM) has also helped our own accounting team by streamlining our revenue processes.
Watch this short video as Tensoft Controller, Dan Berube, explains how Tensoft RRM makes his job easier. From saving time on month-end closes, or having visibility on all transactions in one place, RRM benefits us in numerous ways. For more information, visit Tensoft RRM or our Resource Center.
“Hi I’m Dan Berube, the Controller at Tensoft. Today we will be discussing the benefits of using Tensoft Revenue Recognition Management (RRM). Not only do we develop, sell and support RRM, but we’re also an internal customer.
One of the greatest benefits of RRM is that we no longer need spreadsheets to manage our revenue. All the revenue is within our system. This means we can easily look back at source documents that generated those revenue transactions and we can manage them. I spend most of my time now reviewing or doing analysis on those transactions, as opposed to simply compiling a lot of raw data in order to get my revenue transactions correct. In that way, RRM has been a huge time-saver for us. It allows us to spend more time on the value add activities rather than on the day-to-day mundane activities of keying in data. RRM probably saves us a day or two a month in what it would take us to get through not only bringing in all the needed information to calculate the revenue, but to review it to make sure it is right. Now, I can go to my monthly revenue agreement dashboard and see all the new transactions in a month, as well as, review the ones that are recurring from previous months and take actions that are needed.
We have multiple ways of billing our customers. We bill some customers monthly, we bill some customers yearly, and we bill other customers quarterly. There is also a range of products that they can buy. RRM allows me to have all this information come to one place so it’s clear to see what it is, what actions I need to take, and then provide the report to our management on what the revenue is. They can then see how it was generated and how long that revenue is going to continue for. In addition to that, not only do I get the information I need for the current months revenue, but I can also easily forecast what the next months, quarter, or years revenue is going to be based on those transactions we have in the system. Historically it makes the general accounting for revenue a lot easier, and it also gives us some nice information for looking into future quarters and years.
From a revenue compliance standpoint, Tensoft RRM is very helpful. We are able to take some of our multiple elements arrangements and show that to the customer as one single unit. Then when it comes into the system, we are able to do the analysis there and break that out into the multiple deliverables and allocate the right transaction prices to those. That is also a real benefit, having the system do that for you so that it is presented in a way where I can then make those decisions: break, split out revenue, and hold revenue back in an auditable way. It’s not something I am doing outside of a system, it is linked to the original transaction and comes into a revenue agreement, at which time I can take the right actions and make sure that we are complying with the right revenue standards, depending on what was delivered as part of that agreement.
In combination with RRM, we also use Tensoft CBM – Contract Billing Management. We’ll talk about that more in other posts. CBM generates some of the recurring billings that we have for our customers, which also feeds the revenue management system. I am assured that the billing is being done separate than the revenue. From a customer perspective, the customers are getting their invoices in a timely manner. They are getting them in a way that matches up with what they expect to see based on the original contract. Then that is feeding the revenue deferral management system, so I can manage how I want to act on that revenue. It is really key to have both parts of that system depending on what type of transactions you have. For us, it really allows us to take on a fairly complex range of products and agreements and really utilize the staff we have. We are able to do this and close within 5-7 days, with just a small accounting staff.”
– By Dan Berube, Controller, Tensoft Inc.