---
sidebar_position: 3
title: Amendments, Co-Terming & Upgrades
description: Managing mid-term contract modifications, add-on order forms, co-termed seat expansions, and ASC 606-10-25-12 accounting treatment.
keywords:
  - contract amendments
  - co-terming
  - contract modifications
  - prospective modification
  - cumulative catch up
---

# Amendments, Co-Terming & Upgrades

**Contract Amendments in GAAPx** manage the complete lifecycle of mid-term modifications, tier upgrades, additional seat expansions, and co-terming addenda. GAAPx automatically applies the appropriate ASC 606-10-25 modification rules (Separate Contract, Prospective, or Cumulative Catch-up) without spreadsheet rework.

:::info SCREENSHOT PLACEHOLDER: Contract Lineage & Amendment Timeline
**Location in App**: `App > Contracts > [Contract ID] > Lineage & Amendments`  
**Visual Description**: Timeline view showing original MSA Order Form #1, Amendment #1 (Seat Add-on), and Amendment #2 (Co-termed Renewal), with delta waterfall impact.  
**Recommended Dimensions**: `1200 x 675`  
:::

---

## ASC 606 Contract Modification Decision Engine

When an amendment or add-on order form is ingested, GAAPx evaluates the modification criteria under ASC 606-10-25-12:

```mermaid
flowchart TD
  Mod["New Amendment / Add-on Signed"] --> Q1{"Are additional goods/services distinct?"}
  Q1 -- "No" --> Cumulative["Cumulative Catch-Up Treatment\n(Adjust revenue in current period)"]
  Q1 -- "Yes" --> Q2{"Are goods priced at Standalone Selling Price (SSP)?"}
  Q2 -- "Yes" --> Separate["Separate New Contract\n(Account for amendment independently)"]
  Q2 -- "No" --> Prospective["Prospective Allocation\n(Reallocate remaining price over remaining term)"]
```

### 1. Separate Contract (ASC 606-10-25-12a)
* **Criteria**: Additional distinct goods or services added at their standalone selling price.
* **Accounting Treatment**: Treated as an independent contract; existing schedules remain unchanged.

### 2. Prospective Treatment (ASC 606-10-25-12b)
* **Criteria**: Additional distinct goods added at a discounted rate or bundled with remaining unperformed obligations.
* **Accounting Treatment**: Remaining unamortized contract value is blended with new consideration and recognized prospectively over the remaining duration.

### 3. Cumulative Catch-Up (ASC 606-10-25-12c)
* **Criteria**: Non-distinct goods (e.g., retrospective scope changes or milestone adjustments).
* **Accounting Treatment**: Immediate adjustment recognized in the current reporting period to update cumulative revenue recognized to date.