The Short Answer: Sort of

Stripe provides some features that support revenue recognition, such as invoicing and subscription management, which can help with ASC 606 compliance. However, it does not have a built-in, comprehensive revenue recognition module that automatically handles complex revenue recognition scenarios, requiring users to either use workarounds or integrate with third-party tools for full compliance.

How to Use Revenue Recognition in Stripe (If Yes)

1. Navigate to the Stripe Dashboard and click on “Invoices” to manage and track customer invoices, which can be used to recognize revenue.
2. Click on “Subscription” to set up and manage recurring payments, which can also be used to recognize revenue over time.
3. Result: Stripe will automatically track and record payments, but users will need to manually apply revenue recognition rules and principles to ensure ASC 606 compliance.

Workarounds (If No)

Since Stripe doesn’t support comprehensive revenue recognition natively, you can:

1. Use an Integration: Connect to tools like Sage Intacct or NetSuite, which have built-in revenue recognition modules that can integrate with Stripe.
2. Use a 3rd Party Plugin: Install plugins like RevRec or Revenue Recognition by Stripe Apps, which provide revenue recognition functionality specifically designed for Stripe.
3. The “Hack”: Manually track and record revenue recognition using Stripe’s webhooks and APIs to push data to a spreadsheet or custom database, where users can apply revenue recognition rules and principles.

Better Alternatives for Revenue Recognition

If Revenue Recognition is a dealbreaker for your workflow (Accounting), these tools have it built-in:

• Alternative 1: QuickBooks (Native support) - provides a comprehensive revenue recognition module that supports ASC 606 compliance.
• Alternative 2: Xero (Better implementation) - offers a robust revenue recognition feature that allows users to easily manage and track revenue recognition.

FAQ

Q: Is Revenue Recognition coming in the roadmap? A: According to Stripe’s public roadmap, there are plans to enhance invoicing and subscription management features, but there is no explicit mention of a comprehensive revenue recognition module.

Q: Is this feature gated to the Enterprise plan? A: No, Stripe’s current revenue recognition features are available to all users, regardless of their pricing tier. However, some advanced features and integrations may require a higher-tier plan or additional fees.

📚 Continue Learning

Check out our guides on Stripe and Revenue Recognition.