SaaS Commission Expense

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#1
BFStax  
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I have a client operating on the accrual basis that is a SaaS company. Subscription revenue is recognized over the length of the contract. The sales commission structure is rather complicated and is based on contract amount, geography, segment of customer, etc... The sales reps are only paid commission after the customer pays, and only if the total commission for that month exceeds the reps base salary.. Until now we have been recognizing the commission expense in full when known.

The client now wants to move to a more accrual basis commission accounting where commission expense is recognized over the length of the contract, but to me, this poses quite a problem because we don't know the commission expense until the customers pay and we determine if it exceeds the base salary. About half of customers don't pay until 60-90 days after they are invoiced and their subscriptions have started because the client uses partners to sell/invoice.

I'm not quite sure how to approach this from an accounting standpoint. Is it as simple as estimating an accrual each month?
 

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