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Having inadequate renewals management processes and systems could lead to lost revenue, customer dissatisfaction, and potentially, customer churn. Finding a systematic way to manage renewals to avoid these pitfalls is key to making your customers happy, and growing revenue for your business.

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Your company has worked extremely hard to get the product to where it is today. It’s basically selling itself, adds great value for your customers, and is super sticky, so they’ll want to keep coming back. As new customer sales have grown, you’re running into a speed bump in your process: managing renewals. Many things can go wrong…

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The beginning of Klarity’s AI journey was simple. Manually reading and understanding lengthy contracts and numerous order forms was an arduous and error-prone process that was historically performed exclusively by highly educated individuals. To us at Klarity, making bright people endlessly review contracts is a waste of human potential. Fortunately, cutting edge technology has made it possible to remove the need to manually read and understand contract terms, and, in doing so, significantly improve accuracy. So we set out to build an intelligent system that could not only free humans of this tedious and highly repetitive work but also do…

How to design the best product for revenue accounting teams

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When we at Klarity set out on our course to help Revenue Accountants achieve their contract review goals, we thought long and hard about the full contract review experience. We dedicated our first story on Medium to the problems that accountants are experiencing on a daily, monthly, and quarterly basis and walked through how Klarity can help. To summarize, we talked through the pain points of:

  • Manually pulling down documents from Salesforce
  • Identifying which contracts were required for review
  • Manually reading the same contract terms over and over to “check the box”
  • Documenting review and revenue accounting assessments manually
  • Issues…

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Contracts with customers at enterprise software companies follow a very specific pattern from requesting drafting of a contract to approval by both parties to document storage and potentially re-negotiation. Because revenue accounting can be directly impacted by non-standard contract terms, the revenue team is involved in most steps of contract lifecycle management; sometimes as an informed party, but often as an active contributor to process and negotiations.

Contract Request

The beginning of the cycle starts when the sales team reaches the negotiation stage with the customer and asks the internal legal team to help draft a contract. Generally, sales is…

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Our series on non-standard contract terms that could potentially impact your revenue recognition and accounting brings us to non-standard billing and / or payment terms. Each of these will have a different impact on your accounting treatment, but customers usually negotiate these together which is why we’ve classified them in one subject.

Given the current economic and global climate, your company may find itself in a negotiation for longer payment terms and a more frequent billing cycle. Customers are looking to delay payments and break billings up into smaller increments to keep cash on hand to fund operations or “for…

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Variable consideration as a term is self-explanatory; any consideration that has a variable component whether stated or implied in the contract. Practical application of this definition is not as straight forward. Variable consideration can come in many forms such as discounts, rebates, price concessions, refunds, rights of return, and so on that must be assessed as part of Step 3: Determine the Transaction Price. …

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Automating the Review of Contracts for ASC 606 RevRec

We’re a lean finance department, so our revenue team needs to be super efficient at what they do. We’re fortunate to have brought on Klarity to help streamline our revenue processes.

Sean Deorsey, Chief Financial Officer

Executive Summary

Optimizely built the leading progressive delivery and experimentation platform enabling thousands of companies around the world to optimize their customer experience through a/b testing, feature flagging, and personalization tools. Optimizely is using Klarity to streamline the ASC 606 sales contract review process and automate the population of a custom non-standard terms checklist for 300+ contracts each quarter.

The Challenge

For a mid-size…

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People all over the world are learning now to navigate the new normal while mired by uncertain times, volatile market conditions, and a sudden movement to remote work. Meanwhile, leaders of companies are trying to figure out what will happen next, how to protect their company’s future, and how to sell to customers who don’t want to commit.

Oftentimes uncertainty leads to conservatism in spending and decision making which impacts the way that you’re contracting with your customers. …

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Our series of analyzing non-standard contract terms for revenue impact brings us to early cancellation rights. Early cancellation can come in many forms including termination for convenience which we focused on in our post on June 19th. Giving a customer the right to cancel the contract can also be fore cancellation for failure to deliver a software feature, issues with acceptance testing, or simply customer satisfaction, to name a few. In addition to the many flavors of early cancellation, the right to refund could span from no refund at all to a full refund, and anywhere in between.

Companies must…

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In revenue accounting, we are constantly hearing about “the 5 steps of revenue recognition”. This 5 step process stems from guidance developed by the FASB. Let’s explore the reasoning behind the development of ASC 606 Revenue from Contracts with Customers as well as take a deep dive into the 5 steps and what they mean.

The Financial Accounting Standards Board (FASB) and the International Accounting Standards Board (IASB) initiated a joint project to clarify the principles for recognizing revenue and to develop a common revenue standard for U.S. Generally Accepted Accounting Principles (GAAP) and International Financial Reporting Standards (IFRS). …


Our mission is to empower teams by automating the review of contracts and other documents.

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