The risk the company estimates for concessions to a creditworthy customer outside the contractual requirements of the arrangement increases as the payment terms are extended over longer periods.
To overcome the presumption of concessions, in extended payment term arrangements, a company's history should support the current situation. In addition, the number of historical arrangements needed to overcome the presumption of concessions increases with a greater number of instances in which concessions have been given in extended payment term situations in the past. Examples of factors that should be assessed in this evaluation include. It is also important that the software vendor has documented policies for customers that are granted extended payment terms and has sufficient documentation of its adherence to these policies. Evidence should exist that the vendor's business practice of granting extended payment terms is consistently applied based on the population attributes used to define the class of customer.
Hence, in above situation company has to apply its past experience to decide whether to recognize $10m right away or should apply discounting.