Collectibility Assessment

The ASC 606 Standard

The Step 1 requirement stating a contract does not exist unless it is probable the entity will collect the consideration it is entitled to. Revenue cannot be recognized if the customer is completely unable to pay.

The Real-World Scenario

You sign a massive deal with a company that is publicly on the verge of bankruptcy and has already defaulted on previous invoices.

The Spreadsheet Breaking Point

Manually cross-referencing new enterprise deals with the client's historical bad debt status in an AR spreadsheet leads to massive oversight.

The Hidden Cost to the Bottom Line

Recognizing revenue from a customer who is virtually guaranteed to default inflates top-line metrics with phantom money.

How GAAPX Eliminates the Risk

Automatically cross-references customer credit profiles and pauses revenue schedules systemically if collectibility thresholds fail.