Who isn’t making the move to cloud-based technology? After many years of desktop-based solutions, the initial security concerns have all but disappeared and SaaS tech companies like yours have found fast and easy ways to monetize and build enormous growth. And with that high influx of capital, comes the nagging need for bookkeeping and solid accounting that can keep up with your rapid progress. So where do you start?
What You Need To Know
With unique concerns for SaaS and tech companies when it comes to bookkeeping, there’s not just one solution that fits all. However, there are two specific areas where a company in your industry needs to focus efforts, thanks to constantly changing regulations and a rapidly evolving industry.
1. Types of Expenses
The easiest way to handle expenses from SaaS companies is to split them into two distinct categories: software development or maintenance costs and costs related to unique customers. With the first, assets can generally be written off over time. With the second, a company has the option to expense them or defer them.
2. Revenue & Cost Recognition:
Since SaaS is not a product, but rather a service, it’s unlike a software sale. Most, if not all, of the revenue needs to be realized throughout a contract, rather than when a customer receives the product.
While these two main differences can make accounting difficult, it doesn’t make it impossible. For the best solution, you should consider an outsourced bookkeeping and accounting company with modernized processes that can work with the industry changes as they occur.
How To Make Outsourcing Work For You
You need a modern accounting team that matches with your high-growth team and tools, and you’re not going to get it from an old-school accounting. With a company like Acuity, you can benefit from years of certified experience and get a solution that perfectly matches your workflow and long-term goals.
Get access to:
- A team that understands tech-focused accounting challenges like revenue recognition, equity compensation and issuances, SaaS metrics (MRR, LTV, Chum), and more.
- Accounting that integrates properly with payment methods like Stripe and Paypal
- Access to CFOs to talk through capital raises, financial modeling, and investor relations
With Acuity, you’ll get expert advice because they’re also SaaS providers, which means you get more than someone who knows your business, you get a partner.
Ready to try out the benefits of outsourcing your bookkeeping and accounting? Click here to get started.