// Metrics
Revenue Recognition
Also known as Rev Rec
The accounting process of recording revenue in the period it is earned, not the period it is billed or collected.
In depth
In SaaS, subscription revenue is recognised ratably over the service period. A $120k annual contract signed Jan 1 recognises $10k/month, regardless of whether it was invoiced upfront or monthly. The unrecognised portion sits on the balance sheet as deferred revenue.
Related terms
ASC 606
The US GAAP standard governing revenue recognition from contracts with customers, in force since 2018.
Deferred Revenue
Cash collected for services not yet delivered, sitting on the balance sheet as a liability until earned.
Bookings
Signed contract value in a period. Not revenue; not cash. The leading indicator RevOps lives on.