This guide walks you through configuring how invoices are allocated across periods, applying filters to the Customers tab, reviewing recognition dates customer by customer, and validating MRR, ARR, and IFRS/GAAP reports before turning on automated month-end journals (see How to set up revenue recognition journals in ScaleXP).

Part 1 — Configure how ScaleXP allocates revenue

ScaleXP allocates revenue automatically using a mix of text-recognition AI on your invoice line items and any account-level or invoice-level rules you set.

1. Understand the automated defaults

By default, ScaleXP uses artificial intelligence to calculate revenue recognition from the text on your invoices and from the invoice line item dates. See How ScaleXP reads dates for more information.

When you first connect ScaleXP, it is worth reviewing how this is working on invoices you have already issued. Historical invoice formats may contain conflicting data points that throw off the AI's revenue period, so we recommend spot-checking, or fully reviewing, all invoices for a representative time period to see how ScaleXP is interpreting them. Part 2, section 4 below walks through how to do this review.

For the full mechanics of how revenue is spread across months once dates are read, see How ScaleXP allocates the spread of revenue and determines deferred revenue amounts.

2. Set rules where AI is not enough

You may want to set rules for revenue allocation rather than rely on text recognition. There are several rule types depending on whether the rule applies to a whole GL account or to individual invoice lines.

Set account-level rules

For rules that apply at account level — for example, "spread anything posted to this account evenly over twelve months" — see How to set rule based revenue allocations.

Set multi-tiered rules where the spread varies

Where the allocation should vary based on the invoice content or amount, use a multi-tiered rule. See How to set up a complex, multi-tiered revenue allocation rule. For contracts with different annual amounts, free periods, or extensions, see How to handle revenue recognition for multi-year contracts with different annual amounts, free periods, and contract extensions.

Set usage-based rules where you bill by completion

For revenue recognized by percentage of work delivered or units consumed, set a usage-based rule. See How to set up usage based revenue recognition.

3. Improve your future invoice formats

A small change to the way you write new invoices makes automated revenue recognition far more reliable going forward.

Tighten line item descriptions

Apply the patterns in How ScaleXP reads dates — clear, concise line item descriptions with a single unambiguous date range work best.

Separate recurring and one-time revenue accounts

Keep recurring revenues and one-time revenues in separate GL accounts. This gives you much more flexibility when generating automated metrics like MRR, ARR, and churn.

Use Classes or Tracking Codes for segmentation

Make use of QuickBooks Classes and Locations or Xero Tracking Codes to capture product, department, or geography on every invoice. ScaleXP can then filter and segment metrics, reports, and journals by those dimensions automatically.

Part 2 — Review and validate in the customers tab

Once your allocation is configured, the Customers tab is the place to review the result. ScaleXP offers four view types — Revenue Recognition, MRR, ARR, and IFRS/GAAP — and several default reports, but you will need to configure these reports and apply filters before the numbers are meaningful. This Part walks through each view type, the report options, and the checks to run before you move on to journals.

To get there, select Customers from the main menu. The default reports appear as tabs across the top of the page; click a tab to switch between them.

1. Understand the four view types

The Customers tab offers four ways of looking at the same underlying invoice data, each suited to a different purpose.

Revenue Recognition

Revenue Recognition shows revenue allocated to the period in which the service is provided, taking into account partial months but ignoring invoice date. This is one of the two views that can be used for month-end journals. See How ScaleXP allocates the spread of revenue and determines deferred revenue amounts for the full mechanics.

Monthly Recurring Revenue (MRR)

Monthly Recurring Revenue shows revenue allocated to the service date, like Revenue Recognition, but shows a full month of revenue in the start month and no revenue in the end month — a full month view reflecting the amount of recurring revenue per month. This view is used for analytics and KPIs and is initially set as the global source for MRR metrics. See How to show a full month view of revenue (as used for MRR).

Annual Recurring Revenue (ARR)

Annual Recurring Revenue shows an annualized version of MRR, reflecting a full year of revenue based on revenue in the selected month. ARR in this report is defined as MRR × 12. See How to define and report on annual recurring revenue (ARR) by customer.

IFRS/GAAP

IFRS/GAAP (covering IFRS, US GAAP and UK GAAP) shows revenue allocated to the period in which the service is provided, taking partial months into account, but any revenue earned prior to the invoice issue month is allocated to the month the invoice is issued. This view can also be used for month-end journals. See How to set journals to IFRS or GAAP revenue recognition rules so that backdated revenue is recognized at time of invoice. The trade-off between this view and the Revenue Recognition view for journal posting is covered in How to set up revenue recognition journals in ScaleXP.

2. Configure customer tab reports

Each Customers tab report has a configuration panel that controls what data is included and how it is summarized.

1. Select the report you want to change, then click Configure Report at the top right of the page.
2. Set the Report Name at the top of the panel, and use View to switch between Revenue Recognition, MRR, IFRS/GAAP, and ARR.
3. Under Included Data, choose whether to include or exclude Accrued Revenue that is not from an issued invoice. If you are on the Growth or Scale subscription tier and have your CRM connected, you can also fold future invoices into the view: Future Invoices (year 2 and 3 invoices on a three-year deal, for example) and Renewals (a renewals schedule generated from your contracts). Best practice is to use Save As New when including these revenue types so your forward-looking view is kept separate from issued-invoice reporting. See Updating contracts: how to make changes to contracts in ScaleXP (using ScaleXP Invoicing).
4. Set Lost after — the "grace" period, in months, without revenue from a customer before they are treated as lost — and Reactivated before — the time elapsed before a returning customer is counted as new rather than reactivated.
5. Under Data to be Displayed, choose which summary rows appear at the top of the report: Total Revenue, New Revenue, Lost Revenue, Upsell Revenue, and Downgraded Revenue. Most customers hide the latter four on Revenue Recognition reports and show them only on MRR, since they are used for business analysis rather than accounting or audit purposes.
6. Under Show Totals By, choose how subtotals are split at the top of the page. By default the split is by GL code, but you can change this to tracking codes, classes, locations, or your own customer tags. See How to report on tracking codes for customer data and Customer tags: how to add new fields to the customer page reports.
7. Apply the data filters:
   • Organization — for consolidated companies, filters by subsidiary at the parent level.
   • Accounts — excludes GL accounts that should not appear in the report. We recommend using this on your MRR report so only recurring revenue accounts are included.
   • Tracking Codes or Classes — filters by department, product, or other tag.
   • Invoice Source — includes all invoices, or only those added directly into ScaleXP, imported from Stripe, or synced from your accounting system.
8. Save your changes. Save Report overwrites the existing report with your new settings. Save As New keeps the original report unchanged and creates a copy with your changes — rename the copy so the two are easy to tell apart. To start from a blank report instead, see section 6 below.

3. Apply filters for each report

Use filters to ensure each report is showing the data appropriate for its use. See How to filter accounts on the customer page.

Filter Revenue Recognition and IFRS/GAAP reports

Set these reports to include only the accounts you want feeding deferred and accrued revenue journals.

• By default all accounts are included until at least one is checked, after which only accounts with a blue check are included.
• Tip: When using revenue recognition journals, save a report whose account filters match your journal settings exactly — for example, named "Revenue Recognition — journal match". This makes reconciliation at month and year end much easier.

Filter MRR and ARR reports and configure global settings and KPIs

Set MRR and ARR reports to include only the recurring revenue accounts that should feed your KPIs and churn analysis.

For the full steps to add or remove accounts from the MRR and ARR reports, and how the change flows through to ARR and the dashboards, see How to add or remove accounts from MRR and ARR.

The global MRR report drives every dashboard, metric, and graph that uses MRR in the rest of the system, so this filter is particularly important to get right.

Create and filter new reports

You may want to create several MRR and ARR reports to reflect different segments and enable custom metrics such as churn and cohort analysis. See How to create a new report on the customers page; how to use customer page reports throughout the system and Cohort analysis: how to add a cohort chart in ScaleXP.

4. Check recognition dates by customer

Once filters are applied, work through the Revenue Recognition report a customer at a time to confirm ScaleXP has interpreted each invoice correctly.

1. Pick a representative period. The previous twelve months is a good default. Review the revenue schedule customer by customer, month by month, for a representative sample of customers.
2. Click the dropdown arrow next to a customer to reveal the invoices behind that customer's revenue, then click any invoice to see the line item details and how ScaleXP has interpreted the spread. If no rule is set, ScaleXP spreads the revenue from the Start Date to the End Date using the logic in How ScaleXP allocates the spread of revenue and determines deferred revenue amounts. If a rule is set, you will see a rule symbol in place of the Start Date or End Date — click the symbol to see which rule has been applied. If an invoice you expect is not listed, see How to review invoices issued in the month and download a list in Excel; how to find a missing invoice.
3. Look for misallocated revenue: invoices showing revenue in a period they should not, and invoices missing revenue in a period they should cover. If a date needs to change, you can correct the invoice, correct many invoices in bulk, or request a manual upload — see What to do if the system is not recognizing revenue dates correctly; how to change invoiced revenue start and end dates. You can also set an account rule or invoice-specific rule using the options in Part 1.

5. Review customer numbers and revenue retention

The summary tables at the top of the Customers tab give you the customer-count and revenue-retention picture. Use them to validate that your filters and rules are producing sensible business metrics, not just sensible journal numbers. You choose which summary rows appear under Data to be Displayed in Configure Report (see section 2, step 5).

1. Review the Active, New, Lost, Upsell, Downgrade, and Reactivated customer counts and make sure they match your expectations for the period. For background on how each is calculated, see Customer page summary reports and how they are calculated.
2. Open the default SaaS metrics dashboard and confirm MRR, ARR, churn, and revenue retention all look correct. If they do not, adjust the filters or invoice-level rules from the earlier sections and recheck. See How to change MRR and My metric definitions are not correct. How can I review them? for further detail.

6. Create additional reports as needed

The default reports are a starting point. You will likely want a separate view per business question — recurring revenue only, one-time revenue only, by tracking code, by entity, by product line. See How to create a new report on the customers page; how to use customer page reports throughout the system.

Option 1. Create a blank report

1. Click New Report at the top left of the Customers tab.
2. Choose the View you want, then configure the report as described in section 2.

Option 2. Copy an existing report with Save As New

Use this to change one setting — for example the view — while keeping the account selections and other configuration of a report you already have.

1. Select the existing report and click Configure Report.
2. Change the setting you need, for example choose a different View.
3. Update the Report Name to reflect the change.
4. Click Save As New. The original report is left unchanged.

Related articles

• How to automate revenue recognition in ScaleXP
• How to set up revenue recognition journals in ScaleXP
• How to set journals to IFRS or GAAP revenue recognition rules so that backdated revenue is recognized at time of invoice
• How ScaleXP reads dates
• How ScaleXP allocates the spread of revenue and determines deferred revenue amounts
• What to do if the system is not recognizing revenue dates correctly; how to change invoiced revenue start and end dates
• How to set rule based revenue allocations
• How to set up a complex, multi-tiered revenue allocation rule
• How to handle revenue recognition for multi-year contracts with different annual amounts, free periods, and contract extensions
• How to set up usage based revenue recognition
• How to show a full month view of revenue (as used for MRR)
• How to define and report on annual recurring revenue (ARR) by customer
• How to filter accounts on the customer page
• How to add or remove accounts from MRR and ARR
• How to report on tracking codes for customer data
• Customer tags: how to add new fields to the customer page reports
• Customer page summary reports and how they are calculated
• How to create a new report on the customers page; how to use customer page reports throughout the system
• Cohort analysis: how to add a cohort chart in ScaleXP
• How to review invoices issued in the month and download a list in Excel; how to find a missing invoice
• How to set up metrics in ScaleXP