MOD-004 · effective 2026-03-15 · ASC 606-10-25-13(c)

Renewal with extension

Termination + newProspective▲ Material · 439.6% of prior TCV
Δ TCV+$1,388,145$315,758 → $1,703,903
Δ Recognized—$257,903 → $257,903
Cumulative catch-up—No catch-up
Materiality439.6%Above 5% threshold
Contract timelineQ1 2026 calendar
Master view
Clause diff2 changes
Initial termASC 606-10-25-1View source ↗
termend-date
− Before
3 months, 2026-01-01 through 2026-03-31
+ After
Original term terminated 2026-03-14; renewal term 2026-03-15 through 2027-03-14 (12 months)
Quarterly commitASC 606-10-32-2View source ↗
transaction-pricemonthly-rate
− Before
$287,258 (Jan blended at $97,258; Feb–Mar at $95,000)
+ After
Stub Mar 15-31 terminated; renewal term commit $110,000 / month × 12 months = $1,320,000 + Premium Support $36,000 + estimated overage $90,000
Schedule diff+$8,226 net · 1 of 3 periods changed
CommitOveragePremium supportStub (terminated)Renewal term
$114K$57K$0
JAN
FEB
MAR
Each period: old vs new · click any bar to trace provenance
⤳ chart shows Q1 2026; renewal extends through 2027-03-14
Close memov2 · ASC 606-10-25-13(c)

Facts

On 2026-03-15 Acme and the Company executed a renewal agreement covering the period 2026-03-15 through 2027-03-14. The renewal increases the monthly commit to $110,000 and consolidates Premium Support and corrected overage into a single new agreement. The remaining 17 days of the original-term March (2026-03-15 through 2026-03-31) are superseded by the renewal terms.

Treatment determination

Per the SSP analysis dated 2026-03-10, the renewal price does not reflect standalone selling price of the remaining services; the remaining services are not distinct from those provided under the renewal. The criteria of 25-12 are not met. Under 25-13(c),1 the modification is accounted for as a termination of the existing contract and the creation of a new contract; remaining unrecognized consideration from the original contract is combined with the new consideration and recognized prospectively over the new contract term.

Revenue schedule impact

Periods 2026-01 and 2026-02 are unchanged from the post-amendment-3 baseline. The 17-day stub of original-term March ($52,097 commit at the $95,000 monthly-equivalent rate) is terminated. New contract recognition begins 2026-03-15 at $110,000 commit + $7,500 estimated overage + $3,000 Premium Support per period across the 12-month renewal term, ending 2027-03-14.

Materiality assessment

Δ consolidated TCV is approximately $1.39 million, representing 440% of the prior $315,758 baseline; well above the 5% materiality threshold. Disclosure is required in the 2026-Q1 contract activity memo and on the auditor PBC list. The SSP study (2026-03-10) and term-combination test working paper are required attachments. Renewal commission accrual schedule is amended in parallel under the related ASC 340-40 work; cross-reference workpaper RR-04 in this PBC bundle.

Authoritative citations
  1. [1]ASC 606-10-25-13(c)