It sounds like a script, <@U04K6PGHCL8> unfortunat...
# arm
k
It sounds like a script, @Jason Jensen unfortunately. The concept of ASC606 is that FV stays the same no matter what the sales price is. Variable FV is something unusual I’d say. You can have your Sales do what they what but your FV should stay what you determine it to be once and for all (or at least for a certain period).
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h
@Karina - Would you say that each Item in NetSuite should have a single FV? Example: We have a Saas Product (ratable rev rec) that we sell to customers of all sizes. The more seats the customer purchases, the higher per seat discount they typically get. This isn't always true though as it just depends on what the sales rep ends up closing the deal for (but the list price is tiered in a way that more seats = more discount) As a result, the SSP for this item is kind of all over the place (if we looked at it just from a product level). Thus we have an SSP but the low/high range is pretty wide. Curious what best practices are for this scenario. Do you have different items for each discount tier? (i.e. separate item for SaaS subscription (1-100), SaaS subscription (101-500), etc... with a different SSP and low high range? Or do you truly just have a single SSP value with a wide range?
k
@HN - I thought we just talked about it, no? the concept of FV is that it does not change regardless what the sales price is, that’s what ACS606 is all about
h
Hi @Karina - yes I'm in agreement however what's giving me pause is that based on our data our range is extremely large. We arrived at SSP by looking at the average selling price for standalone subscriptions. Then we took 2 standard deviations from the mean to come up with the low and high ranges. This resulted in a range from 23% (low) to 177%) high. The guidance mentions that the range should be sufficiently narrow and the above just doesn't feel right.
k
I would discuss it with your auditor first. Perhaps you should select another method of determining FV if this is not adequate. You also may want to review other functions available in ARM formulas