ASC 606 (US GAAP) and IFRS 15 (international) are converged accounting standards that establish a unified framework for revenue recognition. They require companies to recognize revenue when they satisfy performance obligations to customers, not simply when cash is received.

Example: A SaaS company selling a 12-month subscription for $1,200 upfront recognizes $100 in revenue each month, not the full $1,200 at the time of payment.