Klarity
AI-driven revenue recognition and contract compliance automation
About Klarity
Klarity reads contracts and produces the revenue recognition output your auditors need: extracted performance obligations, calculated recognition schedules, and disclosure-ready journal entries under ASC 606 or IFRS 15. Day-to-day, that means uploading executed contracts and getting back structured data that feeds directly into NetSuite, SAP, or Oracle rather than routing through a senior accountant with a spreadsheet. For enterprise SaaS and professional services companies processing hundreds of contracts per quarter, that replaces a week of technical accounting work with a review task. The platform also handles lease accounting under ASC 842, which makes it useful beyond the revenue recognition team. If your business has both complex customer contracts and a large lease portfolio, Klarity covers both without a separate point solution. Quarter-end close acceleration is the most cited outcome from users, particularly where contract volume spikes and manual analysis becomes the critical path. The fit is narrow. Klarity earns its cost at organizations with high contract volumes, mixed revenue arrangements, and technical accounting complexity. A manufacturing company with fixed-price purchase orders or a professional firm billing hourly gets nothing from it. Contract data quality matters too — inconsistent formatting, scanned PDFs, or non-standard terms slow the AI and require manual correction that erodes the time savings.
Best for
SaaS companies and enterprises needing automated revenue recognition compliance
Key Features
- AI-powered contract analysis for revenue recognition
- Automated ASC 606 and IFRS 15 compliance
- Performance obligation identification and extraction
- ASC 842 lease accounting automation
- Quarter-end close acceleration
Pros & Cons
Pros
- Extracts performance obligations directly from contract language, replacing manual review by technical accounting staff.
- Generates ASC 606 and IFRS 15 recognition schedules and journal entries ready for auditor review.
- Handles ASC 842 lease accounting in the same platform, reducing the need for a separate lease management tool.
- Native integrations with NetSuite, SAP, Oracle, Workday, and Salesforce push recognized revenue data without manual rekeying.
- Cuts quarter-end close time materially for businesses processing 200-plus contracts per period.
- Surfaces contract terms that trigger variable consideration or constraint provisions that manual review often misses under time pressure.
Cons
- Custom enterprise pricing with no published tiers — expect a significant commitment before any numbers appear, which makes budget comparison difficult.
- No practical path for mid-market companies under roughly 200 contracts per quarter; the economics don't work at lower volumes.
- Accuracy depends on contract data quality. Scanned PDFs, handwritten amendments, and non-standard clause structures degrade output and reintroduce manual work.
- No QuickBooks or Xero integration, which rules out the tool for any company not running an enterprise ERP.
- Implementation requires mapping contract structures to your ERP chart of accounts — plan for several weeks of setup before the automation runs cleanly.
- Switching costs are high once recognition schedules are embedded in the platform; extracting historical data for a migration is painful.
Ledger Brief Take
Tackles the genuinely complex problem of automating ASC 606/IFRS 15 revenue recognition for contract-heavy businesses, where manual analysis creates quarter-end bottlenecks. The AI contract reading goes beyond basic extraction to identify performance obligations and calculate recognition schedules — substantive automation that replaces hours of technical accounting work. Built for enterprise SaaS and services companies with high contract volumes, not smaller practices dealing with straightforward revenue streams.
Frequently Asked Questions
Common questions accountants ask about Klarity.
How much does Klarity cost?
Klarity publishes no pricing. All contracts are custom-quoted based on contract volume, ERP environment, and scope of standards covered. Budget conversations typically start at enterprise software price points. Request a quote through klaritylaw.com; expect a demo before any numbers are discussed.
Does Klarity integrate with QuickBooks or Xero?
No. Klarity integrates with NetSuite, SAP, Oracle, Workday, and Salesforce. It targets enterprise ERP environments exclusively. If your company runs QuickBooks or Xero, Klarity is not the right tool for your stack.
How does Klarity compare to manual spreadsheet-based revenue recognition?
Manual ASC 606 workbooks require a technical accountant to read each contract, identify obligations, and build recognition schedules. Klarity automates the reading and structuring step. For high contract volumes, that difference is measured in days per close. For low volumes, the spreadsheet approach is cheaper and faster to implement.
What happens when contracts have non-standard or ambiguous terms?
The AI flags terms it cannot classify with confidence for human review rather than making a silent assumption. However, heavily non-standard contracts — particularly those with handwritten amendments or complex variable consideration structures — require meaningful accountant time to resolve. Klarity reduces but does not eliminate technical judgment on difficult contracts.
Is contract data stored securely, and can it be used to train Klarity's models?
Klarity targets enterprise clients who require data isolation. Confirm your specific data handling terms during contract negotiation, particularly whether your contract content is used for model training. Enterprise agreements typically include data isolation clauses, but review this directly rather than assuming.
How long does implementation take before the automation is producing reliable output?
Expect four to eight weeks for a standard implementation covering ERP mapping, contract ingestion setup, and output validation against prior-period recognized amounts. Companies with complex multi-element arrangements or heavily customized ERP configurations run longer. Factor this timeline into any quarter-end deadline planning.