RightRev launches unified lessor accounting for XaaS providers
RightRev has introduced a lessor accounting product integrated directly into its revenue recognition platform. This new approach combines ASC 842/IFRS 16 lessor lease accounting and ASC 606/IFRS 15 revenue recognition within a single system, intended for hardware companies adopting Everything-as-a-Service (XaaS) business models.
Compliance gap
Hardware companies are increasingly shifting to service-oriented models, bundling products with software, subscriptions and services. This requires systems that can reconcile both lease and revenue accounting standards. Historically, existing solutions have focused on lessee accounting, leaving lessors reliant on disconnected tools, custom software, or manual spreadsheets to bridge the gap between ASC 842/IFRS 16 and ASC 606/IFRS 15 requirements.
Companies operating in sectors such as medical technology, industrial equipment and high-tech hardware have encountered operational issues with this fragmentation. Without unified automation, finance teams risk material misstatements, audit issues and longer close cycles.
Lessor focus
The new product processes lessor contract data for hardware, equipment and device providers that offer Hardware-as-a-Service, Equipment-as-a-Service and Device-as-a-Service models. By providing a single platform that automates allocations across bundled contracts and different revenue streams, it aims to reduce compliance risk and the manual workload placed on teams.
According to RightRev, using a unified system minimises duplicate data entry, simplifies reconciliation and expedites period close for lessors, compared to using separate lease and revenue software. Automated revenue schedules and journal entries are generated and can be reviewed for posting, improving efficiency.
Bundled models
Finance departments are facing increasing pressure as XaaS contracts grow in popularity. These often bundle usage rights for hardware with ongoing services or software, making accounting more complex. Addressing the dual requirements of lease and revenue standards is now seen as essential to the rollout and management of recurring revenue models.
Many companies see this as a means to create predictable revenues, grow customer relationships and reduce costs for buyers. But legacy systems, originally designed for separate compliance requirements, have become a bottleneck for organisations looking to scale these models.
Sector requirements
RightRev's solution has been developed to meet the specific requirements of the lessor-a group often operating at high volume and with complex bundled contracts. The platform is positioned as a system of record for revenue and lease compliance, regardless of industry vertical.
With the combination of accounting standards-ASC 842/IFRS 16 for leases and ASC 606/IFRS 15 for revenue recognition-companies can manage embedded financing structures and bundled offerings within a single automated environment.
Customer needs
"Leasing is no longer just a financing model; it's evolving into Everything-as-a-Service (XaaS), where companies monetise complex combinations of hardware, software, professional services and usage. Our customers told us loud and clear: fragmented systems and spreadsheet workarounds were creating compliance risk, slowing their close, and limiting their ability to innovate.
"That's why we built the industry's first unified lessor revenue subledger: a single, event-driven engine that connects lease events under ASC 842/IFRS 16 directly to revenue recognition under ASC 606/IFRS 15. This architecture gives any company with hardware, devices or equipment the flexibility to launch their XaaS business model to capture recurring revenue and price how their customers want to buy," said Dan Miller, CFO, RightRev.
