Introduction
NetSuite‘s Advanced Revenue Management (NetSuite ARM) solves the challenge of navigating the complexities of modern revenue recognition. With more companies adopting subscription-based and contract-intensive models, the requirement for accurate and timely revenue reporting has never been higher.
PwC emphasizes that revenue recognition errors continue to rise as complex contracts and changing accounting standards mount. To deal with these challenges, leading companies turn to NetSuite ARM.
This high-performance solution provides companies with automated revenue forecasting, recognition, and compliance, helping them achieve financial accuracy and operational efficiency.
From high-growth software firms to multinational enterprises, organizations like Adobe have run the platform to drive operational efficiency, reduce risks, and drive bottom-line growth.
Understanding NetSuite Advanced Revenue Management (ARM)
A feature of the NetSuite ERP program called NetSuite ARM assists companies in controlling and streamlining their revenue recognition procedures. It offers a single platform for managing revenue recognition for various products, services, and revenue streams.
It streamlines revenue recognition procedures while lowering the possibility of errors and non-compliance. It automates based on established revenue recognition schedules, revenue allocation criteria, and contract terms.
When managing a consistent production operation, revenue management can frequently be ignored. In addition to coming up with a revenue recognition plan that drives additional company, you also need to manage your funds. Making a strong plan is essential because ASC 606 regulations are always changing.
It can be difficult to stay current with rules, but it’s crucial that your earnings are appropriately recorded and reported. If not, you can be endangering your company. Utilizing revised ASC 606 criteria in conjunction with revenue management strategies doesn’t have to be scary.
Within NetSuite ARM, you may customize your revenue recognition module to meet business needs. NetSuite implementation makes it simple to recognize revenue at varied periods or in equal quantities. It only requires a single button click to accomplish this.
NetSuite ARM Configuration for Businesses
Contract Management
NetSuite ARM empowers businesses to account for their revenue recognition on contracts by specifying when to recognize revenue, accounting for any modifications in the contract, and processing the billing and revenue allocation.
This software service is very useful for companies dealing with complex contracts or whose model depends on recurring revenues. Folio3 will assist your company in presenting and optimizing the use of NetSuite ARM in managing these contracts.
Subscription Revenue
This service is tailor-made for subscription-based businesses looking to manage their revenue recognition, thereby deferring it over time, handling cancellations and refunds, or managing renewal contracts.
This is an ideal solution for any company offering software as a service, media subscription, or any subscription-based product or service.
Professional Services Revenue
It is the most preferred for revenue recognition management in professional services businesses, be it managing time and material contracts, project-based revenue recognition, or even revenue allocation across multiple services.
This makes it an ideal solution for consulting, marketing, or engineering businesses.
6 Ways NetSuite ARM Enhances Revenue Recognition
1. Versatile Revenue Recognition Rules
NetSuite ARM allows your business to configure revenue recognition rules with unmatched flexibility to fit your business model. Whether it is attached to time, specified milestones, or usage, your revenue can be accommodated in the system.
You could set up complex revenue recognition schedules that consider various things like discounts, rebates, and returns. The adaptability will ensure that the revenue recognized is correct and conforms with the accounting standards.
2. Automated Revenue Processes
Based on this flexibility, NetSuite ARM also offers automatic application of the revenue recognition rule during sales transactions, eliminating manual interference and reducing errors in the process, hence fast-tracking revenue recognition.
The applicability and deployment of a business definition for rules dealing with complex accounting standards make the process accurate and efficient.
3. Accurate Revenue Forecasting
The power of NetSuite ARM in revenue estimation allows enterprises to project future revenues from the present trends in historical data, contract terms, and market trends. Its predictive power thus drives strategic decisions in management, resource allocation, and budgeting.
Understanding the revenue pattern and potential growth areas can help organizations streamline operations and exploit new opportunities.
4. Efficient Contract Management
Effective contract management is the other cornerstone of NetSuite ARM. It manages the entire process from creation to negotiation, renewal, and termination. Such complex contracts with multiple deliverables and different terms are easily managed for appropriate revenue recognition based on contract stipulations.
Real-time tracking of contract performance yields rich insights into contract profitability and customer behavior.
5. Real-Time Revenue Insights
On the side of supporting informed decisions, NetSuite ARM provides real-time performance visibility into revenues. It allows one to produce detailed reports by product, region, customer, and other key metrics.
Custom dashboards bring clear overviews of the business trend in revenues, thus helping it to point out opportunities and challenges and act on them. The capability to drill down into transaction-level data supports rigorous analysis and solution of problems.
6. Ensuring Regulatory Compliance
NetSuite ARM ensures that organizations stay compliant, following all the criteria for revenue recognition as specified by ASC 606 and IFRS 15. Compliance-automated checks within the system ensure the right revenue recognition based on the relevant stipulations.
With the smoothing of the compliance process and alleviated risk of errors, there are no reputational damage or financial penalties for business entities under this NetSuite ARM.
Why Choose Expert-Led Training
The robust NetSuite Advanced Revenue Management module can help you adhere to the most recent accounting requirements while managing your intricate revenue streams. However, integrating this module without the proper partner might be difficult and time-consuming.
Because of this, you ought to go with expert-led solutions, such as those provided by Folio3, a reputable NetSuite partner with the knowledge, resources, and experience necessary to help you thrive with NetSuite’s cutting-edge revenue management.
Our NetSuite implementation, integration, and customization solutions may offer you the best, regardless of whether you require support, customization, integration, or implementation.
Conclusion
In conclusion, the global accounting software market shall be worth $20.4 billion, growing at a CAGR of 8.02% from 2018 to 2026, according to Fortune Business Insights. The trend indicates that businesses are fast abandoning these manual, inefficient ways of revenue recognition and instead opting for accounting software.
Of the various accounting software available, one excels in advanced revenue recognition automation, which is the NetSuite ARM. Different modules for various revenue streams allow for different revenues to be recognized from different sources or verticals. Besides, it is flexible in design and in compliance with the existing and future revenue standards.
