Alteryx Use Cases

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Building a Model to Comply with ASC 606

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Overview of Use Case

When ASC 606, the new revenue recognition standard, was issued, the Financial Planning and Analysis team at Alteryx faced the challenge of the new rule’s complexity. The old process in place to recognize revenue was no longer an option, and to make the transition, the team created a model with Alteryx Designer. In a couple of weeks, the team automated revenue calculation and implemented checks and balances to ensure compliance with the new rule.


Describe the business challenge or problem you needed to solve
  • The ASC 606 accounting standard had a significant impact on how Alteryx recognizes revenue through our sales transactions. The rule provides a framework for businesses to recognize revenue more consistently, the purpose being to eliminate variations in the way businesses across industries handle accounting for similar transactions.
  • The new rule took effect in 2018, but we had to look at contracts going back to 2015 and 2016 because some three-years contracts were still ongoing. In all, we had more than 100,000 lines of data to process.
  • Basically, our ERP system was unable to handle the complexity involved in accounting revenue under ASC 606, and of course, failure to comply with the new rule could have serious legal implications and penalties.
Describe your working solution

We had to build a model on Alteryx Designer to aggregate invoice and contract information, segregate different products among different customers, allocate revenue between products, and ultimately recognize a pattern that complies with the new standard.

  •         We started by looking at different datasets in our ERP system, such as sales orders, invoices, and credit memos, and then we merged all the information together to have everything on one line.
  • Next, we brought in details of specific product work, and we needed to layer in additional details around our ELAs and DLAs. In the ERP System, the ELA was a single line, but to run the 606 revenue calculations, you need to see the actual products underneath. So, we expanded those single lines into multiple lines with exact quantities and values.

  • After that, we did another data cleansing. This time, we checked to see if everything is being accounted properly, and if not, we adjusted and replaced.  
  •         We calculated order total value and term, and ultimately it spits out a file that we use to calculate revenue.clipboard_image_3.png
Describe the benefits you have achieved
  • Thanks to Alteryx’s ease-of-use, one person was able to put this model together in a matter of weeks. It runs once a month, and we don’t have to recreate it every time.
  • Without Alteryx, this type of model would require the work of 3 to 4 people over a longer time frame.
  • Our accounting team uses the output for revenue recognition.
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This is absolutely amazing! Are you able to share this model?