# Glossary ### **Subscription Billing, Revenue Recognition, SaaS Metrics** ### **A** [Account Hierarchy](https://ordwaylabs.com/resources/glossary/account-hierarchy/) ### Account Hierarchy What is Account Hierarchy? Learn how SaaS companies bill & report across parent-child accounts for enterprises. Simple definition + example. [Accounts Receivable](https://ordwaylabs.com/resources/glossary/accounts-receivable/) ### Accounts Receivable Learn how accounts receivable works in SaaS. Discover its impact on cash flow, DSO, revenue audits, and billing-to-cash sync. [Accounts Receivable Collections](https://ordwaylabs.com/resources/glossary/accounts-receivable-collections/) ### Accounts Receivable Collections Learn how collections work in SaaS finance, how automation reduces DSO, and why disciplined AR workflows strengthen cash flow and audit control. [ACH Payment](https://ordwaylabs.com/resources/glossary/whats-an-ach-payment/) ### ACH Payment What’s an ACH Payment? How SaaS companies use bank transfers to reduce fees & failed payments. Setup guide + benefits for finance. [Advance Billing](https://ordwaylabs.com/resources/glossary/advance-billing/) ### Advance Billing What is Advance Billing? How SaaS companies invoice upfront & recognize revenue over time. ASC 606 compliant guide with examples. [Annual Recurring Revenue (ARR)](https://ordwaylabs.com/resources/glossary/annual-recurring-revenue-arr/) ### Annual Recurring Revenue (ARR) What is ARR in SaaS? Simple definition, calculation formula & real examples. Learn what counts (and what doesn’t) in ARR reporting. [ARR Movements](https://ordwaylabs.com/resources/glossary/arr-movements-saas/) ### ARR Movements Learn how SaaS finance teams track ARR movements—new, churn, contraction, and expansion—to explain growth and improve forecasting accuracy. ### **B** [What Is a Billing Address and How Is It Used?](https://ordwaylabs.com/blog/billing-address/) ### What Is a Billing Address and How Is It Used? A billing address is the address linked to your credit card, debit card, or bank account that banks and merchants use to verify your identity when you make a payment. [Billing Waterfall](https://ordwaylabs.com/resources/glossary/billing-waterfall/) ### Billing Waterfall What is a Billing Waterfall? Learn how it automates invoice timing, payment allocation & ensures ASC 606 compliance. Simple guide. [Batch Invoice Generation](https://ordwaylabs.com/resources/glossary/what-is-batch-invoice-generation/) ### Batch Invoice Generation What is Batch Invoice Generation? How SaaS companies automate monthly billing runs for 1000s of customers. Reduce errors & save time. ### **C** [Credit Memo vs Debit Memo](https://ordwaylabs.com/resources/glossary/credit-memo-vs-debit-memo/) ### Credit Memo vs Debit Memo Credit Memo vs Debit Memo: Clear definitions, when to issue each, & how to automate without errors. Essential for SaaS finance teams. [Churn Rate](https://ordwaylabs.com/resources/glossary/churn-rate/) ### Churn Rate Learn what churn rate means in subscriptions and SaaS. Understand types of churn, how to calculate it, and benchmarks for customer and revenue retention. Improve churn with data-driven strategies. [Chart of Accounts (CoA)](https://ordwaylabs.com/resources/glossary/chart-of-accounts-coa/) ### Chart of Accounts (CoA) What a Chart of Accounts (CoA) is, how it structures financial reporting, and why a clean CoA is vital for SaaS revenue accuracy and audit readiness. [Chargebacks](https://ordwaylabs.com/resources/glossary/chargebacks/) ### Chargebacks Learn what a chargeback is, how it works in SaaS billing, and how it affects revenue recognition, reconciliation, and audit readiness. ### **D** [Disputes](https://ordwaylabs.com/resources/glossary/what-is-a-dispute-in-saas-finance/) ### Disputes Understand what a dispute means in SaaS billing, how it affects AR and revenue recognition, and why automated dispute management reduces financial risk and customer churn. [Deferred Revenue Waterfall](https://ordwaylabs.com/resources/glossary/deferred-revenue-waterfall/) ### Deferred Revenue Waterfall What is a Deferred Revenue Waterfall? Step-by-step visual guide for recognizing revenue monthly under ASC 606. Download template. [Deferred Revenue](https://ordwaylabs.com/resources/glossary/deferred-revenue/) ### Deferred Revenue What It Means (Simple Explanation) Deferred revenue is money you’ve been paid—but haven’t earned yet. If a customer pays upfront for a year, you can’t call it revenue right away. It sits as a liability… [Deferred Billing](https://ordwaylabs.com/resources/glossary/what-is-deferred-billing/) ### Deferred Billing What is Deferred Billing? How it differs from deferred revenue. Use cases in SaaS & impact on cash flow & financial reporting. ### **F** [Financial Statements](https://ordwaylabs.com/resources/glossary/what-are-financial-statements/) ### Financial Statements What are Financial Statements? Simple breakdown of P&L, Balance Sheet & Cash Flow for SaaS startups. Why investors care. Read guide. ### **G** [General Ledger (GL)](https://ordwaylabs.com/resources/glossary/general-ledger-gl/) ### General Ledger (GL) Learn what a general ledger (GL) is, how it works in SaaS finance, and why it’s the foundation for accurate financial reporting and audit readiness. ### **I** [Invoice Number](https://ordwaylabs.com/resources/glossary/invoice-number/) ### Invoice Number What is an Invoice Number? Why unique, sequential IDs matter for SaaS billing, payments & audits. Best practices + examples. [Income Statement](https://ordwaylabs.com/resources/glossary/whats-an-income-statement/) ### Income Statement What’s an Income Statement (P&L)? Simple breakdown for SaaS founders. Learn how to read revenue, COGS, expenses & net profit. ### **J** [Journal Entry](https://ordwaylabs.com/resources/glossary/journal-entry/) ### Journal Entry What a journal entry is, how it works in accounting, and why automated entries are essential for GAAP compliance and audit-ready SaaS financial reporting. ### **M** [Monthly Recurring Revenue (MRR)](https://ordwaylabs.com/resources/glossary/monthly-recurring-revenue-mrr/) ### Monthly Recurring Revenue (MRR) What is MRR in SaaS? Simple definition, calculation formula & how it differs from ARR. Track growth accurately with real examples. ### **N** [New ARR](https://ordwaylabs.com/resources/glossary/what-is-new-arr/) ### New ARR What is New ARR? How it differs from Expansion ARR. Formula, examples & why it’s a key growth metric for SaaS companies. [Net Revenue Retention (NRR)](https://ordwaylabs.com/resources/glossary/net-revenue-retention-nrr/) ### Net Revenue Retention (NRR) What is NRR? Step-by-step formula, benchmarks & 3 proven ways to improve it. Essential SaaS metric for investors & growth. ### **P** [Proration](https://ordwaylabs.com/resources/glossary/what-is-proration/) ### Proration What is Proration? How SaaS companies calculate partial charges for mid-cycle upgrades/downgrades. Formula + automation best practices. ### **R** [Renewal](https://ordwaylabs.com/resources/glossary/what-is-a-renewal-in-saas-finance/) ### Renewal Learn how renewals work in SaaS finance, how automation supports ARR stability, and why renewal accuracy is critical for revenue recognition and forecasting. [Remittance Advice](https://ordwaylabs.com/resources/glossary/remittance-advice/) ### Remittance Advice Learn what remittance advice means, how it works in SaaS finance, and why it’s essential for accurate invoice matching and cash reconciliation. [Refund](https://ordwaylabs.com/resources/glossary/refund/) ### Refund Navigate refunds in recurring revenue businesses. Understand definitions, workflow, accounting impacts, and challenges. Discover how automation ensures accuracy & compliance. [Ramp Deal](https://ordwaylabs.com/resources/glossary/ramp-deal/) ### Ramp Deal What is a Ramp Deal? How SaaS companies structure gradual price increases. Automate billing & rev rec with ASC 606 compliance. ### **S** [Subscription Upgrade](https://ordwaylabs.com/resources/glossary/subscription-upgrade/) ### Subscription Upgrade When a customer moves to a higher-priced plan or adds more features, seats, or services to their existing subscription. [Subscription Plan](https://ordwaylabs.com/resources/glossary/what-is-a-subscription-plan/) ### Subscription Plan Defines the pricing, billing frequency, feature entitlements, and usage allowances a customer receives in exchange for a recurring fee. [Subscription Pause](https://ordwaylabs.com/resources/glossary/subscription-pause/) ### Subscription Pause What is a Subscription Pause? How to temporarily suspend billing & rev rec without churn. Use cases + automation tips for SaaS. [SOX Compliance](https://ordwaylabs.com/resources/glossary/sox-compliance/) ### SOX Compliance U.S. federal law that requires public companies to maintain strong internal controls over financial reporting (ICFR) ### **U** [User Based Pricing](https://ordwaylabs.com/resources/glossary/user-based-pricing/) ### User Based Pricing What is User-Based Pricing? How per-seat billing works, common pitfalls & how to scale revenue without leakage. Real SaaS examples. [Usage-Based Billing](https://ordwaylabs.com/resources/glossary/what-is-usage-based-billing/) ### Usage-Based Billing Usage-based billing charges customers based on actual consumption. Learn how to operationalize it for ASC 606 compliance and SaaS revenue accuracy.