Gaap revenue vs cash revenue and what to use
Can someone tell me how id go about calculating cash vs gaap revenue for a saas business? Why is there a need to look at cash revenue? Shouldnt you always value off gaap revenue?
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This may be too simplistic but the situation that comes to mind is a customer paying for a subscription 12 months in advance. Ignoring any discount for paying 12 months upfront, if the company is only half way through its fiscal year then only 50% of revenue would be recognized but the full cash amount has been received.
Hi yes, this makes sense conceptually and helpful. I am more wondering if there is ever a need to model out cash revenue and if so when?
Hi yes, this makes sense conceptually and helpful. I am more wondering if there is ever a need to model out cash revenue and if so when?
Typically you just look at EBITDA + change in deferred revenue and book to bill timing. Never have I ever looked cash revenue for any reason and 80% of what I do is SaaS.
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