This thesis examines the various impacts of the new revenue recognition accounting standard on software and SaaS companies. It begins by explaining why the FASB and IASB updated the existing revenue recognition standard and then compares and contrasts the legacy US GAAP to the IFRS standard. It then moves into a detailed analysis of the key changes affecting the software and SaaS industry. Additionally, it examines the major interpretational areas within IFRS 15. Also, it addresses the major impact on Software and SaaS’s entities’ financial statements and therefore their profitability and performance. Finally, it concludes with a discussion of investor considerations and how the standard has impact users of the financial statements. While there is abundant knowledge of the accounting change within the accounting industry, there is less knowledge and almost no quantitative information for the public after IFRS 15 implementation, which based on the various changes detailed, will result in a surprising material.
