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When data flows seamlessly from your Customer Relationship Management (CRM) system into your accounting system, you have an automated and streamlined quote-to-cash process that reduces data entry, improves accuracy and increases efficiency. You need an accounting system that can:
- Integrate Salesforce with your accounting system to accelerate the quote to cash process. Data entry is reduced and reconciling between systems is eliminated – thereby improving accuracy, days sales outstanding (DSO) and customer satisfaction.
- Easily handle an increase in customers, transactions and locations to allow you to scale complex revenue recognition It should require only a couple of clicks to consolidate multiple entities.
- Provide one centralized and holistic view of your entire quote to cash process for a single system of record throughout the contract lifecycle. Whether changes are input into the CRM or the accounting system, it shouldn’t matter as the data should flow between systems keeping accounts and teams updated. Your sales and accounting team will also have one complete view of each customer.
“Now, when our sales team closes a deal in Salesforce, order details are automatically added to Sage Intacct,
my team validates the revenue schedule, and then generates an invoice in just five minutes.”
–Brett Belcastro, Revenue Controller, Acquia
2. Handle billing and revenue models unique to the subscription and SaaS industries
Order-based systems cannot handle different types of revenue streams or revenue schedules. And, they do not have the ability to scale to support increasingly complex billing and recurring revenue models. Your modern accounting system should:
- Help you accelerate cashflow with flexible, contract-based billing and powerful recurring revenue recognition, even when managing fairly complex, multi-subscription contracts with differing billing schedules. It should be able to handle different revenue recognition formulas based on subscription type, and deploy recurring billing, across perpetual, usage, and professional services.
- Help sales teams access and analyze information to spot upsell opportunities and churn conditions, positively impacting the bottom line and the customer experience, to maximize customer lifetime value (CLTV). It should be flexible to help you innovate and incorporate new offerings as opportunities are found.
- Provide the financial framework that consistently captures and manages data through the life of the contract and customer lifecycle for quicker, easier analysis, and improved confidence in the data. Your sales and accounting team should also have one complete, identical, view of each customer.
3. Support ASC 606 and GAAP compliance requirements
Meeting the requirements of the ASC 606 revenue recognition standard, which provides a framework for the SaaS/Subscription industry as to the amount and the timing of revenue recognition, is not easy. While it is only five steps, it is complex enough for Ernst and Young to have created a 480-page guide. It is extremely important as it helps ensure an accurate valuation of your business. Your new accounting system should provide:
- End to end revenue management in one system that integrates the entire quote to cash process. Additionally, look for billing and revenue recognition that span the entire customer lifecycle to align with ASC 606 requirements and that help you easily comply with GAAP reporting requirements.
- A single system of record for revenue recognition across unbilled, billing and paid across recognized and deferred revenue
- Handling the multitude of revenue recognition scenarios such as daily or monthly recognition, and across revenue types, such as usage-based, perpetual licensing, and professional services
- An IT-free way of handling revenue management requirements. A method that relies on configuration, not scripting, reducing the need for IT or consulting services.
4. Provide native and configurable SaaS Metrics financial reporting, and dashboards
This is where the CFO can step up to be the hero. In addition to keeping a watchful eye on the health of your company, SaaS metrics help you identify issues that can kill your company like excessive churn or high customer acquisition (CAC) costs. SaaS metrics are what your investors are looking for; they provide the essential metrics key to landing the next round of funding, from proving product market fit, to confirming your revenue engine is working. You shouldn’t have to pull your team from their day-to-day tasks of running the back office to spend hours tracking and compiling these key metrics. You need a new accounting system with SaaS metrics that can:
- Provide you with real-time data showing the historical trends of your business and where it is headed with dynamic CFO and SaaS metrics dashboards. Whether you are proving product market fit or heading towards an IPO, you need to know the state of these six SaaS metrics: Committed Monthly Recurring Revenue (CMRR), Customer Acquisition Cost (CAC), Churn, Customer Lifetime Value (CLTV), Cash Flow and Customer Count.
- Provide real-time data to help minimize risk. Now that you can see things as they happen, you have more time to act, correct course, or prevent an issue from arising.
- Improve efficiency with role-based dashboards that provide visibility into business drivers whether in sales, product or finance. With one version of the truth, collaboration is easier. Teams throughout the company will be able to have more strategic discussions about where opportunities abound and processes can improve, and fewer discussions about what is accurate and current.
5. Help you easily create forecasts and build agility into your planning
You can take your reporting, and confidence in its data, to new levels by switching from reports with manually entered equations which are focused 100% on the past, to reports incorporating scenario planning and forecasting with powerful automation and drill down capabilities. To use data to make strategic decisions quicker, your QuickBooks replacement should:
- Provide strong forecasting capabilities that include Machine Learning (ML) and Artificial Intelligence (AI) to help you keep your company’s trajectory constantly in view.
- Enable you to perform scenario planning so you can pull the right levers and make adjustments to drive business outcomes and influence your company’s trajectory.
- Help you move from an order-by-order view to a comprehensive view of customers for a better understanding of cash flow and other financial metrics. Among other things, it should include prebuilt, customizable GAAP and SaaS metrics dashboards that automate the tracking and management of data to deliver real-time insight for quicker data-driven business decisions.
Read more about the essential features to look for in your search for a QuickBooks replacement in the new eBook from Sage Intacct, Essential Features Every CFO Needs in Their Next Subscription Management Solution. Get your copy today.
As a Senior Product Marketing Manager for Sage Intacct, Annette Grotz helps SaaS and Professional Services companies discover how Sage Intacct helps them successfully grow and scale. Annette has been creating excitement behind customer expectations, industry trajectories and product capabilities for over two decades.