Revenue Recognition

3 Months Ended

Sep. 30, 2020

Revenue from Contract with Customer [Abstract]

Revenue Recognition

Revenue Recognition

    Remaining Performance Obligations

    The transaction price we allocate to remaining performance obligations that are unsatisfied, or partially unsatisfied, as of September 30, 2020 represents contracted revenue that will be recognized in future periods. Our future performance obligations consist primarily of SaaS / stand-ready performance obligations relating to future periods, contracted but uncompleted professional services obligations and support and maintenance obligations. During the three months ended September 30, 2020 and 2019, the amount of revenue recognized from performance obligations satisfied in prior periods was not significant.

    Revenue allocated to remaining performance obligations was $416.4 million as of September 30, 2020 of which we expect to recognize approximately $147.6 million over the next twelve months and the remainder thereafter. We exclude from our measure of remaining performance obligations amounts related to future transactional or usage-based fees for which the value of services transferred to the customer will correspond to the amount we will invoice for those services.

    Contract Assets and Liabilities

    The table below presents our accounts receivable, contract assets and deferred revenue balances as of September 30, 2020 and June 30, 2020.

	September 30,	June 30,
	2020	2020	$ Change
	(in thousands)
Contract assets	4,704	3,646	1,058
Deferred revenue	85,260	96,033	(10,773)

    Contract assets arise when we recognize revenue in excess of amounts billed to the customer and the right to payment is contingent on conditions other than simply the passage of time, such as the future completion of a related performance obligation. Contract assets are classified in our consolidated balance sheets as other current assets for those contract assets with recognition periods of one year or less and other assets for contract assets with recognition periods greater than one year. We assess outstanding accounts receivable and contract assets for credit loss on an ongoing basis. In estimating credit loss, we pool accounts with similar risk characteristics. Accounts that do not share the same risk characteristics are assessed for credit loss on an individual basis. The allowance for credit loss is based on historical loss data, customer specific information, current market conditions and expected future economic conditions. Historically, our bad debt expense has not been significant but could be adversely affected in future periods due to the impact of the COVID-19 pandemic.

Deferred revenue consists of billings or customer payments in excess of amounts recognized as revenue.

The decrease in deferred revenue at September 30, 2020 as compared to June 30, 2020 reflects our recognition of revenue from maintenance contracts, a significant portion of which are billed on a calendar year basis, as well as the impact of foreign exchange changes.

    For the three months ended September 30, 2020 and 2019, we recognized $40.3 million and $34.0 million in revenue from amounts that were included in deferred revenue as of June 30, 2020 and 2019, respectively.