True-Ups
True-Ups
The ASC 606 Standard
A periodic reconciliation billing process where a customer is charged for usage that exceeded their baseline contract commitment. It ensures the company is fully compensated for actual value delivered.
The Real-World Scenario
A client prepaid for 500 software seats but provisioned 550; at the end of the quarter, you must bill them for the extra 50 users.
The Spreadsheet Breaking Point
Manually comparing expected baseline commitments against actual consumption at quarter-end is labor-intensive and frequently forgotten.
The Hidden Cost to the Bottom Line
Missed true-ups result in uncollected cash and permanently lost revenue that drops directly off the bottom line.
How GAAPX Eliminates the Risk
Systematically tracks actual usage against contract entitlements and automatically generates true-up revenue events exactly when thresholds are crossed.