After a buyout, the CFO should check the 20 largest customer contracts against invoices and payments within 90 days, and price the gap in dollars.
The check measures revenue leakage: money that customers owe under their contracts but that is never billed or never collected. The dollar figure goes into the value creation plan, the profit goals that owners and managers agree for the years of ownership.
MGI Research runs a research program on how companies price and bill. Its December 2025 research note defines revenue leakage as "the variance between contractually obligated revenue and actual recognized revenue." The note calls it a failure of the work that runs from pricing and contracts through billing and cash collection. In MGI's view, revenue recovered on goods or services already delivered adds to profit at high margins, since the delivery costs were already paid. The note also warns that unbilled work more than 90 days old faces "significant risk of permanent loss."
A second study measures how much contract value organizations lose. World Commerce & Contracting updated its contract research with Deloitte in 2022, drawing on data from more than 1,200 organizations. Deloitte, which sells audit, tax and consulting services, summarized it in Boosting ROI across the contract management lifecycle, a page dated September 2023. On that page, organizations lost an average of 8.6 percent of contract value. The page does not say how much of that loss sits in contracts with customers.
The same page traces the loss to how contract work is done. At most organizations, it is spread across many people and systems, with no single place where the data comes together. A check that sets contracts, invoices and payments side by side builds that single place for the largest customers.
A survey closer to billing came from DigitalRoute, a Stockholm company that sells software to measure and bill usage. Its June 2026 survey report asked 631 executive leaders in the US, the UK and four other European markets in April and May 2026. Most respondents' companies charge at least partly by usage. A company that bills fixed fees should read the survey as a looser guide. Of all 631 respondents, 60 percent estimated that billing errors put 2 percent or more of revenue at risk.
Asked where errors are first found, 29 percent of the same respondents named customer disputes. Only 17 percent named automated checks run before an invoice goes out. The CFO should not wait for disputes. A customer billed too little has no reason to raise one.
The check uses records the company already holds, and existing finance staff run it within their current budget, with no new software. Weeks count from the day the deal closes. The billing manager lists each billing term in the 20 largest contracts by last year's revenue: prices, discounts, yearly price increases and minimum charges. The billing manager then compares those terms with every invoice sent to those customers in the last 12 months.
The controller matches the same invoices to payments received, and lists each credit that cut a customer's bill without a reason on file. For each gap, the controller records the dollar amount, the cause, and whether the contract allows billing for past months. Whether to bill a customer for a past shortfall is the CEO's decision, taken after reading that contract.
What to do first:
- Billing manager: compare the billing terms in the 20 largest customer contracts with 12 months of invoices, by week four.
- Controller: match those invoices to payments and credits, and record each gap in dollars with its cause, by week eight.
- CFO: put the total and its causes into the value creation plan by day 90.
- CEO: decide, customer by customer, whether to bill any past shortfall.
An operating partner, the private equity firm's partner who works on company operations, can ask every newly bought company for the same check. Each company's result reads against its own revenue, because contract terms differ from one company to the next.
In 2014, World Commerce & Contracting's research had found organizations losing an average of 9.2 percent of contract value.
