Revenue Recognition Schedule
Paste contracts and get the monthly revenue recognition schedule plus the deferred balance at each month end: the waterfall that takes an hour by hand.
How do I build a revenue recognition schedule?
Spread each contract's value evenly across the months of its term, starting from its service start date, then sum across contracts by month. That gives recognised revenue per month; the deferred revenue balance is the cash you have collected less what has been recognised to date. Straight-line recognition over the service period is the standard treatment for subscription contracts delivered continuously, which covers most SaaS arrangements.
How to use this tool
- 1
Paste your contracts
One per line: customer, start date, term in months, and total contract value.
- 2
Get the monthly schedule
Recognised revenue by month across every contract, with each contract's own waterfall beneath it.
- 3
Check the deferred balance
The closing deferred revenue balance at each month end, which is the figure that ties to your balance sheet.
Straight-line is the default, not the rule
This tool applies straight-line recognition, which is correct for most subscription contracts and wrong for several common cases. Four to watch for.
Distinct performance obligations
A contract bundling software with implementation services contains two obligations that may be recognised on different patterns. Under current standards the transaction price is allocated between them, and straight-lining the total is incorrect.
Usage-based components
Consumption revenue is recognised as it is consumed, not evenly. A contract with a platform fee plus usage needs the two parts split before either is scheduled.
Start date versus signature date
Recognition begins when the service starts, which is often not when the contract was signed. Using the signature date shifts revenue into the wrong period, sometimes across a year end.
Mid-month starts
A contract starting on the 20th earns a partial month. Whether you pro-rate by day or apply a convention is a policy choice, but it must be consistent: switching between the two makes your monthly trend meaningless.
A schedule is not a close
This produces the schedule from the contracts you paste. Reconciling it to your ledger, where mid-term upgrades, cancellations, credit notes, and contract modifications all have to be reflected: is the part that consumes the close. Each of those events changes the remaining schedule from the modification date forward, and keeping that reconciled every month is a recurring exercise rather than a one-off calculation.
See how DataWyse answers thisQuestions finance teams ask about this tool
Is there a revenue recognition schedule template?
This tool replaces the template. Paste contracts with start date, term, and value and it returns the monthly recognition schedule plus the deferred revenue balance at each month end. A spreadsheet template does the same arithmetic but has to be rebuilt whenever the contract mix changes, which is where most manual schedules drift out of agreement with the ledger.
What is a revenue recognition schedule?
A month-by-month plan showing when contracted revenue will be recognised as earned. It converts a set of contracts with different start dates and terms into a monthly revenue forecast, and produces the deferred revenue balance that appears as a liability on the balance sheet.
What is deferred revenue?
Cash you have collected for services not yet delivered. It is a liability, not a performance measure, despite frequently being read as one. A growing deferred balance means growing obligations owed to customers, which is generally healthy for a subscription business but is not revenue.
When does revenue recognition start?
When you begin transferring the service to the customer, not when the contract is signed or the invoice is raised. For subscription software that is normally the service start date, which can be weeks or months after signature.
How do I handle a contract that is cancelled mid-term?
Stop recognising from the cancellation date and release the remaining deferred balance according to your refund obligation. If no refund is due, the remaining balance is typically recognised at that point; if a refund is owed, it becomes a payable rather than revenue.
Does this tool handle ASC 606 multi-element contracts?
No. It applies straight-line recognition across a single performance obligation, which is correct for standard subscription contracts. Bundled arrangements with distinct obligations require the transaction price to be allocated between them first, which is a judgement your auditors will want to see documented.
Is this tool really free?
Yes. No signup, no email required, no usage limit. It runs entirely in your browser: nothing you type is uploaded to a server or stored anywhere. We build these because the people who find them useful are the people who eventually need a financial analyst that works the same way.
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