A Baker Tilly client, an international perpetual license software company (the Company), provides solutions around asset tracking, patient safety, and theft prevention in the healthcare industry. The company has $18 million in global revenues, with 40 percent coming from Europe through its subsidiary located in Finland. The company received lender mezzanine financing which precipitated the need for audited financial statements for the first time. Baker Tilly was engaged to conduct a two-year global audit.
Revenue recognition for perpetual software licenses is a complex accounting area. During the planning phase, Baker Tilly recommended a revenue recognition working session with management. In collaboration with Baker Tilly, management developed a US GAAP global revenue recognition assessment that can be applied across countries. This effort successfully implemented the appropriate US GAAP revenue recognition accounting policy globally for the Company.
In addition, working in concert with the Baker Tilly International member firm, Baker Tilly Finland, Baker Tilly designed its global approach to the consolidated audit. This allowed the teams to begin the year-end group audit early on in the new fiscal year. As a result, an audit was successfully completed on the consolidated financial statements for the first time.
Acting as our client’s Valued Business Advisors and as a leading independent member of the Baker Tilly International, a global accounting and advisory network we seamlessly collaborated with Baker Tilly Finland to successfully deliver a first-year audit report and the client was able to meet its lender obligations.
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