---
sidebar_position: 2
title: Structure, Metadata & Clause Extraction
description: Deep extraction of commercial metadata, performance milestones, and non-standard legal clauses for ASC 606 compliance.
keywords:
  - clause extraction
  - non standard terms
  - contract metadata
  - ASC 606 clauses
---

# Structure, Metadata & Clause Extraction

**Structure & Clause Extraction in GAAPx** transforms unstructured legal contract language into normalized, machine-readable accounting metadata required for ASC 606 Step 1 (Contract Identification) and Step 3 (Transaction Price Determination).

:::info SCREENSHOT PLACEHOLDER: Clause Detection Inspector
**Location in App**: `App > Contracts > [Contract ID] > Legal Clauses`  
**Visual Description**: Highlighted contract clauses with categorized tags for Termination for Convenience, Penalty Claws, CPI Adjustment Caps, and Payment Milestones.  
**Recommended Dimensions**: `1200 x 675`  
:::

---

## Critical Non-Standard Clauses Detected

### 1. Termination for Convenience (TFC)
* **Accounting Impact**: Under ASC 606-10-25-3, contracts with unilateral termination rights without substantive penalties must limit the enforceable contract term to the notice period.
* **GAAPx Action**: Automatically constrains the revenue amortization schedule to the enforceable period and triggers warning flags in Deal Desk reviews.

### 2. Variable Consideration & SLA Penalties
* **Accounting Impact**: Liquidated damages or SLA credits represent variable consideration subject to the constraint under ASC 606-10-32-11.
* **GAAPx Action**: Evaluates historical refund probability and sets automated accrual reserves.

### 3. CPI & Inflation Escalation Caps
* **Accounting Impact**: Annual price increases tied to Consumer Price Index (CPI) or fixed percentages require dynamic schedule recalculation at anniversary dates.
* **GAAPx Action**: Schedules automated price uplift events on future billing cycles.