---
title: Minimum Revenue Guarantees
description: A contract clause where the customer commits to spending a minimum amount of money, regardless of actual consumption. It requires careful reconciliati...
sidebar_position: 27
tags: ['asc-606', 'Revenue']
---

# Minimum Revenue Guarantees

## The ASC 606 Standard

A contract clause where the customer commits to spending a minimum amount of money, regardless of actual consumption. It requires careful reconciliation to recognize unexercised commitments.

## The Real-World Scenario

An advertiser commits to spending $100,000 on your platform this year, even if they only end up running $60,000 worth of actual ads.

## The Spreadsheet Breaking Point

Manually reconciling actual usage against a fixed baseline commitment at the end of the year requires massive data exports and manual true-ups.

## The Hidden Cost to the Bottom Line

Failing to recognize the unexercised portion of a minimum guarantee means permanently underreporting guaranteed cash flow.

## How GAAPX Eliminates the Risk

Continuously tracks actual usage against the guarantee and automatically recognizes any remaining commitment revenue precisely when the period ends.