Financial reporting is a wide world where you see lots of unusual things — and we saw another odd one recently, from software company PTC Corp.

PTC filed its latest earnings release on Oct. 24. This was the first time PTC reported revenues according to ASC 606, the new accounting standard for revenue recognition that all firms had to start using this year.

Important point: PTC sells software, and specifically sells subscription-based software. And as we’ve noted in prior posts, software firms in that line of work are particularly prone to changes in the nature and timing of their revenue streams thanks to that new standard.

Essentially, ASC 606 forces software companies to recognize revenue from long-term subscription contracts all at once. So a firm implementing ASC 606 for the first time might see a spike in revenue for that specific quarter, as it recognizes all that subscription revenue; and then lower, more volatile revenue streams in future quarters.

Sure enough, PTC fits that description. So first the company gave investors this head’s up in its disclosures:

In connection with its adoption of ASC 606, PTC expects to record an adjustment to retained earnings of $350 million to $380 million related to deferred revenue and unbilled deferred revenue amounts… This adjustment will be reflected on PTC’s consolidated balance sheets for the first quarter of fiscal 2019 ending December 29, 2018. We estimate this adjustment will reduce future annual subscription revenue as follows: for FY’19: $200 million - $220 million; FY’20: $100 million - $105 million; FY’21: $35 million - $40 million; FY’22: $15 million.

We expect that this will have a material adverse effect on reported revenue in FY’19 that will be only partially offset by the upfront revenue recognition of the license portion of new subscription contracts and renewals. In FY20 and beyond, we expect the adverse impact related to the retained earnings adjustment will be more than offset by upfront revenue recognition of the license portion of subscription contracts.

In other words, turbulence lies ahead for PTC in fiscal 2019. Fair enough; we’ve seen other software firms make similar disclosures.

Then PTC went above and beyond with its estimates for 2019. The company presented its business outlook twice — once according to ASC 606 as required by accounting rules; and again under the old accounting standard, ASC 605.

Take a look. Figure 1 on top presents PTC’s outlook according to the old ASC 605 standard. Figure 2 at the bottom is the outlook according to the new ASC 606 standard.

The subscription revenue line-item (flagged in red) is the key point here. ASC 606 cuts that revenue from somewhere around $141 million (the old standard) to $93 million (under the new standard).

Can a firm do that with its financial reporting? Um, sure; there’s no law against it. PTC does obey all SEC rules about presenting both versions in identical format and clearly stating why PTC believes the older standard is worth noting. That’s what a company has to do to include a non-GAAP metric, which the outdated revenue standard now is.

We just didn’t expect a firm to go to such extremes. Then again, that’s what makes financial analysis so interesting.