The 10 best SaaS revenue recognition software to automate financial reporting in 2024

While previously spreadsheets were more than enough to handle SaaS revenue recognition, it’s no longer that simple. Stricter regulations and intricate pricing models have upped the complexity — making revenue recognition software a must-have for any finance team. Let’s explore how the top RevRec tools can help you automate revenue accounting.
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While the marketing and sales teams spearhead pricing strategy, the finance team shoulders a larger responsibility — ensuring the revenue reports align with accounting standards. This includes adherence to international frameworks like IFRS 15 and GAAP, as well as specific revenue recognition guidelines like ASC 606.

For instance — under ASC 606, recurring subscription models in SaaS often require estimating a variable price when determining the total transaction value for revenue recognition. However, you don’t need to do this for usage-based pricing. 

Similarly, if you’ve got an affiliate or partner program, you’ll need to estimate those discounts and returns before closing the sale. All of this makes SaaS revenue recognition a complex endeavor. This can get even more complicated if you’re handling things manually.  

What starts as a couple of spreadsheets becomes an elaborate patchwork of integrations — with accounting teams linking various tools like CRM and ERP to Excel so they can auto-generate reports, calculate deferred revenue, and create revenue ledgers.   

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But revenue recognition software — especially when implemented early — can go a long way in both streamlining (and automating) your RevRec operations. 

And that’s what we’ll be covering in this blog — how the top revenue recognition tools for 2024 can help you automate revenue accounting, generate accrual-based financial reports, and more.

What is revenue recognition software?

Revenue recognition software is a cloud-based, automated system that helps finance teams — particularly revenue accounting professionals — to allocate, monitor, and recognize revenue, ensuring they stay compliant with audits and international accounting standards. 

With revenue recognition software you can automate everything — from journal entries and revenue schedules to recognizing revenue using different methods like straight-line, milestone, or fixed periods. 

Plus, you can use custom recognition and deferral rules to address different pricing components, mid-contract updates, and terminations, ensuring accurate revenue recognition and ASC 606 compliance. 

Here’s quoting Ben (The SaaS CFO) on why RevRec tools might be a better option to spreadsheets —

“I’ve passed annual financial audits with a spreadsheet process, but you lose so much visibility into deferred revenue and customer reporting, and you’re hoping that the auditors don’t find some hidden formula error that you overlooked.”

Put simply, you can avoid such situations as the one mentioned below — 

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The top 10 SaaS revenue recognition tools for 2024

Let’s compare the top revenue recognition and financial reporting tools and see how they stack up against each other. 

Zenskar

Zenskar is a modern billing and revenue recognition software solution that’s purpose-built for SaaS subscription scenarios — usage-based and hybrid pricing models, custom contracts (and performance obligations), and accrual-based accounting. 

With Zenskar, you can —

  • Recognize revenue using different approaches like straight-line, exact days, fixed periods, milestones, or usage-based.
  • Break contract terms into performance obligations and recognize them progressively over the contract period. 
  • Create balanced journal entries for accrued and deferred revenue, adjust revenue schedules, and recalculate revenue based on contract amendments.
  • Maintain separate revenue sub-ledgers for each jurisdiction or entity so you can comply with local compliance requirements.
  • Generate ASC 606 and IFRS-15 compliant balance statements and revenue reports. 

The best part — Zenskar offers custom integrations upon request, so you can integrate it with your existing CRM, ERP, or accounting software.

Yembo, an AI property inspection platform, saw a 100% drop in revenue leakage by automating RevRec with Zenskar. By moving away from siloed spreadsheets, they were able to align revenue recognition for prepaid subscriptions and postpaid overages and ensure that the revenue expected in one month didn't spill into the next.

Zenskar’s pricing

Zenskar’s pricing plans depend on the complexity of your billing requirements and your transaction volume. Fill out this form to get a custom quote. 

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Stripe Revenue Recognition

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Stripe Revenue Recognition is one of Stripe’s 21+ FinTech tools and along with Stripe Billing, it can help SaaS companies allocate and recognize revenue. At the moment, it’s available in 40 countries. 

It enables you to recognize revenue, adjust schedules, and create both revenue waterfall tables and journal entries so you can get a clear picture of your cash flow. Plus, it even allows you to import non-Stripe revenue and contracts — so you can bring all your data into one place.  

But Stripe is not without its quirks — for example, if you have hybrid pricing models with annual contracts and monthly overages, you’ll need to create two different subscriptions to recognize revenue accurately. 

Stripe Revenue Recognition’s pricing

Stripe charges a commission of 0.25% for every successful transaction. If you have multiple settlement currencies or large transaction volumes, then you might be eligible for a discount. 

Chargebee

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While Chargebee did initially launch as a subscription management platform for small businesses (particularly B2C), its recent acquisitions — RevRec, Receivables, and Retention — have strengthened its revenue recognition capabilities. 

It allows you to automate revenue recognition from start to finish with features like RevRec and deferral rules, standalone selling price (SSP) libraries, and revenue sub-ledgers. 

While Chargebee streamlines revenue recognition, its lack of depth (such as an option to add notes or disclosures) may hinder full GAAP compliance. It also falters if you have multiple currencies.  

Chargebee’s pricing 

Though Chargebee’s base platform comes with a freemium model, you need to be on one of their paid plans to purchase Chargebee RevRec as an add-on. Also, some users have mentioned that the add-on is expensive (even when compared to Stripe). 

Maxio

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Maxio — the merger of Chargify’s billing system and SaaSOptics’ revenue management platform — gives SaaS companies a unified financial platform that streamlines both billing and revenue recognition. 

Maxio supports both one-time and recurring subscriptions and is particularly good with recognizing revenue for usage-based pricing structures. It also offers pre-configured reports to compare different RevRec scenarios and make strategic decisions.   

While all of this makes it a solid RevRec tool for SaaS companies, it comes with two major drawbacks. Firstly, you need to manually clean up data synced from your CRM platform before generating your RecRec report. Second, Chargify and SaaSOptics are not fully integrated — which results in a disjointed user experience.

Maxio’s pricing

At $5000 per year, Maxio is one of the more expensive SaaS revenue recognition tools. 

Zuora

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Zuora has been the billing system of choice for enterprise SaaS companies with high-volume transactions and stringent security protocols. Its revenue recognition tool is also one of the most robust and compliant, going beyond RevRec automation and real-time revenue reconciliation. 

It can analyze your historical transaction data to gauge your compliance rates, calculate transaction price allocations, and prepare compliant disclosure reports. 

However, as Zuora considers subscriptions to be monthly by default, setting up and recognizing revenue from annual subscriptions can be tricky. Plus, Zuora is also not the most flexible or automation-friendly tool, and you’ll need to rope in your engineering team for most customizations. 

Some users have also reported that they find implementing (and maintaining) Zuora to be both a complex and expensive endeavor and you might need to get in touch with their team frequently.   

Zuora’s pricing 

Contact Zuora directly for pricing details.

OneBill

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OneBill is a legacy, industry-agnostic FinOps platform that has recently started supporting revenue recognition. As it considers both telecom and XaaS to be its main userbase, it comes with out-of-the-box support for usage-based revenue recognition. 

It allows you to set up revenue recognition rules, generate ASC-606-compliant reports, and automate monthly journal entries. You can also categorize revenue with predefined codes and generate custom reports.

However, OneBill being a decade-old tool comes with an outdated UI and is not the easiest to use (or customize) — one user even calls it software built by engineers for accountants and as such it lacks nuance. Also, as OneBill’s primary ICP is telecom companies, its features are rather complex and come with a learning curve.  

OneBill’s pricing 

While OneBill offers three pricing tiers, revenue recognition is only available in its highest tier. Plus, you might have to pay an extra fee for financial integrations. 

Recurly

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Though primarily a subscription management platform, Recurly comes with a comprehensive revenue recognition tool that supports multiple currencies and complies with global accounting standards. 

This makes it a great option for non-US-based SaaS companies — as you can choose your reporting format (IFRS, GAAP, or ASC 606). Plus, Recurly supports both subscription and usage-based pricing models and allows you to set up variable considerations like discounts, rebates, and refunds. 

However, you need to subscribe to its subscription management platform to access this module, and that’s where Recurly falters. For one thing, you need engineering support to set up usage-based pricing. It also has limited reporting capabilities when compared to some of the other tools on this list.  

Recurly’s pricing

Recurly provides two revenue recognition add-ons — Standard and Advanced

Trullion

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Trullion is one of the few ‘AI-powered revenue recognition tools’ in the market. It also integrates with most CRM and ERP platforms and is ASC 606, IFRS 15, and SOX compliant. Capabilities-wise, it comes with a solid set of features including custom revenue recognition rules, pricing thresholds, and audit logs. 

However, people have reported issues with its AI capabilities — while one user says it doesn’t read contracts accurately, another has found the AI search capability to ignore certain phrases in contracts. And like most AI tools, Trillion is also not accurate when it comes to non-English languages. 

Trullion’s pricing

Contact Trullion directly for pricing.

NetSuite

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Oracle NetSuite is a business management solution that comes with ERP, inventory management, and accounting solutions among others. SaaS companies using NetSuite’s accounting or ERP platform can purchase Revenue Recognition as an additional module.

Some features included in NetSuite’s Revenue Recognition module are rule-based revenue allocation workflows, real-time financial reporting, and revenue forecasting. It also supports multiple revenue recognition approaches including fixed date, milestone, and percentage. 

At the same time, it lacks some of the more basic features like ‘auto-save’ — so if you don’t manually save a report of revenue schedule, it’s lost forever. Plus, users often report slow loading speeds and a dated user interface, though the latter seems to be a common issue across most Oracle products.

NetSuite’s pricing

NetSuite provides only annual subscriptions and your fee is dependent on three elements — the core platform fee, the modules required, and the number of users. The Revenue Recognition can be purchased as an add-on module.

Some users have complained about NetSuite’s frequent price hikes — with one stating their fee has increased by 130% in the last 6 years. On top of that, they have fewer features in their current plan than they used to.

Quickbooks

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Quickbooks (by Intuit) is an enterprise accounting software solution that comes with some built-in revenue recognition capabilities. It allows you to calculate deferred revenue and generate GAAP-compliant RevRec reports. 

However, Quickbooks doesn’t support automated performance obligations or variable price estimates — both of which are mandated by ASC 606. So you might have to take care of these manually.  

Plus, Quickbooks and especially its advanced features are quite complex, with some users reporting that they’ve made errors simply because they couldn’t understand how the platform worked.  

Quickbooks’ pricing 

Quickbooks offers revenue recognition only on its Advanced plan which starts at $200 per month and includes 25 users. But this might be more than early-stage or growing companies need, especially considering the software’s complexity. 

Choosing the right revenue recognition software

While most accounting and billing systems come with RevRec capabilities, they’re all not built the same. Here are some points to consider when picking your revenue recognition tool —

Flexibility 

At its most basic, SaaS revenue recognition is simply recognizing the annual recurring revenue (ARR) of each customer across their contract term.  

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But while the revenue recognition metric (ARR) is the same, the revenue recognition method differs depending on the type of contract or pricing model — and that’s where things get tricky. 

For example, for recurring subscriptions, you can estimate your ARR based on the monthly fee. However, if you allow refunds, then you’ll have to look into your historical data and subtract the refund amount from your estimated ARR.  

Apart from the pricing model, here are two other things to consider —

  • Termination provisions: Especially important for multi-year contracts, if you allow no-cause terminations, then your performance obligations become monthly instead of annual. So if you have a 5-year contract, then it has to be considered as 60 monthly contracts when determining performance obligations, and not 5 yearly contracts.
  • Setup services vs. implementation services: Though similar, they carry some extra nuance when it comes to revenue recognition. Setup — like setting up their account or onboarding their team — is not a performance obligation. Implementation services like migration support or custom integrations, on the other hand, are a performance obligation. 

So go for a revenue recognition tool that not only supports a variety of pricing models but also gives you the ability to frame revenue recognition guidelines for different contract types and services. 

Compliance 

The next important factor to consider is whether your revenue recognition tool complies with international accounting standards like GAAP and IFRS-15. 

SaaS companies registered in the United States must also comply with ASC 606, the revenue recognition standard issued by the US Financial Accounting Standards Board (FASB) — a framework that even some of the more seasoned accountants find difficult to grasp

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So choose revenue recognition software that’s ASC 606-compliant by default. For instance, it should help you define and manage "performance obligations" within your contracts, generate GAAP-compliant reports, and handle variable pricing like discounts, refunds, or overages. 

The last one is especially important if you have a freemium model or usage-based pricing components. 

Scalability

Most SaaS companies update their pricing at least once a year. Take Equals, the SaaS reporting tool — they’ve changed their pricing model three times in one year. And if you’re selling to enterprise customers, then no two contracts are the same. 

As your business grows, so will the complexity of your pricing models and contracts. At the same time, you’ll also be expanding your FinTech stack to include more tools to automate your more advanced workflows and processes. 

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That’s why it’s important to look at scalability from two directions — the complexity of your pricing strategy and your future FinTech requirements. Let’s say you’re planning to automate your accounting with NetSuite, then choose a revenue recognition tool that either integrates with NetSuite or takes up custom integration requests.  

Related webinar: The evolution of revenue recognition and its impact on modern business models

Why automate revenue recognition with Zenskar

Choosing the right revenue recognition tool — one that’s designed to address SaaS-specific pricing models and revenue recognition standards — can make all the difference in your FinOps. 

And Zenskar is one of the few billing systems that’s purpose-built for new-age SaaS companies with usage-based and hybrid pricing models. From defining performance obligations from contracts and managing sub-ledgers to generating GAAP-compliant reports — automate revenue recognition with just a few clicks.

Plus with Zenskar, we’re happy to go the extra mile to help you set up a revenue recognition system that works for you — whether that’s migration support or a custom integration with your CRM or ERP tool.

Curious to learn more? Book a demo and we’ll show you how Zenskar can automate revenue recognition, start to finish.

Frequently asked questions (FAQs)

1. How to automate revenue recognition?

SaaS companies can leverage revenue recognition software to automate key tasks like setting up RevRec models, generating ASC 606-compliant reports, and integrating with CRM/ERP tools to sync customer subscription and contract details.

You can also use custom rules to create revenue recognition workflows and templates for different pricing models or account for changes in a customer’s subscription like upgrades, downgrades, and cancellations.

2. How does revenue recognition software work?

Revenue recognition software performs three key functions:

  • Syncing with your CRM or ERP solution to fetch customer subscription details
  • Automating calculations based on your chosen revenue recognition models such as fixed period, straight-line, and more
  • Generating ASC 606-compliant financial reports and maintaining detailed audit records

3. How does the ASC 606 impact SaaS revenue recognition?

ASC 606 has significantly impacted how SaaS companies recognize revenue, primarily the ‘timing of recognition’. Previously, they could record revenue from contracts upfront, at the beginning or end of a subscription period. Now, revenue recognition is progressive, meaning it is spread out over the subscription period, instead of all at once.

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