---
title: Contract Combination
description: The requirement to account for two or more contracts entered into at or near the same time with the same customer as a single contract. This prevents ...
sidebar_position: 7
tags: ['asc-606', 'Contracts']
---

# Contract Combination

## The ASC 606 Standard

The requirement to account for two or more contracts entered into at or near the same time with the same customer as a single contract. This prevents companies from artificially manipulating revenue timing through contract structuring.

## The Real-World Scenario

A sales rep breaks a $500,000 enterprise rollout into three separate contracts signed in the same week just to hit specific quarterly quota tiers.

## The Spreadsheet Breaking Point

When a sales rep splits a deal to hit quota, disparate invoicing dates cause manual accountants to completely miss the required combination.

## The Hidden Cost to the Bottom Line

Treating combined contracts separately manipulates margin and revenue timing, resulting in severe compliance violations and audit penalties.

## How GAAPX Eliminates the Risk

Automatically links associated contracts by customer, date, and commercial objective, applying consolidated revenue rules instantly.