GTM misreporting is a risk your company can’t afford to take

Go-to-market (GTM) accounting may soon be very different.

Every quarter, GTM spending gets tucked into operating expenses on the P&L. It sits beside payroll and rent, treated as if it were just another cost of doing business—that’s the accounting treatment. But economically, it’s a fiction.

GTM doesn’t behave like OpEx. It behaves like CapEx. It is front-loaded, risky, and deployed with the expectation of multi-period returns. And when it fails, it doesn’t simply vanish — it leaves behind stranded, impaired capital. That is one of the reasons why GAAP rules around the treatment of GTM expense may soon change.

It needs to change because every dollar of customer acquisition cost (CAC) is debt.

The current accounting method has marketing and sales writing “promissory notes” against future customer cash flows. If the money arrives, the debt gets serviced. If it doesn’t, the debt defaults, and shareholder capital eats the loss.

For CEOs and CFOs, this is not a semantic trick. It is a governance reality, and ignoring it invites fiduciary risk.

GTM as CapEx in disguise

Think about how you treat building a factory. It’s recorded as CapEx, depreciated and tracked against its expected return. Everyone recognizes it as a capital allocation decision with consequences.

GTM works the same way. The commissions, campaigns, events, enablement programs and onboarding all hit before a single dollar of customer revenue arrives. Repayment comes later, through renewals, expansions and margin flow across years. When churn cuts that cycle short, the capital is stranded — no different from a shuttered plant.

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However, CAC is an obligation, and debt requires reimbursement. When you spend to acquire a customer, you incur a liability that must be repaid from future customer cash flows. If repayment doesn’t come, the “loan” defaults, and the loss falls to shareholders.

Why finance becomes the underwriter

In theory, B2B marketing and sales should underwrite these notes. They should be able to evaluate repayment curves, time decay, churn risk and opportunity cost. But in practice, they can’t. They lack the mindset, tools and credibility.

That means finance becomes the de facto underwriter of GTM risk. It’s not a role finance asked for, but it’s where fiduciary responsibility lands. Finance must:

• Demand fully loaded CAC numbers, not cherry-picked ones.
• Model repayment velocity and churn-adjusted breakeven.
• Compare GTM use of capital against alternative deployments.
• Stress-test CAC portfolios under adverse conditions.

In other words, finance has to run GTM budgeting like a credit committee — deciding which notes to issue, which to deny and at what cost.

The lie of underreported CAC

Most CAC numbers shown in decks are fiction. They are stripped down to look efficient — campaign spend is counted, but commissions, onboarding, martech and overhead are left out.

The truth is that if it takes cash to bring a customer to breakeven, it belongs in CAC. That means every GTM expense is CAC. Anything less is a lie. Boards relying on underreported CAC are not making capital allocation decisions. They are making blind bets.

Boards should insist that every LTV figure be accompanied by its basis of calculation: sample size, time span, churn variance. Without that, LTV is not governance, it is theater.

Velocity, time value and opportunity cost

Even when CAC is repaid, the timing matters. A customer who buys and pays in a matter of months is low risk. A customer who takes years is effectively accruing interest. Velocity is the interest rate on GTM debt.

Then there are the silent killers. A dollar repaid three years from now is worth far less than a dollar today. That’s the time value of money, and most GTM payback charts ignore it.

Put together, they make CAC doubly dangerous. It is not only principal plus interest. It is principal plus hidden decay.

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As such, GTM looks exactly like a lending portfolio. You can load up on volume, but defaults pile up if you aren’t underwriting customers responsibly. Marketing and sales often chase topline numbers. They inflate the size of the loan book without screening for repayment probability.

The portfolio problem

Boards should stop asking, “How much pipeline do we have?” and start asking, “How healthy is our CAC portfolio?” Because the truth is, not all notes perform. Some are solid, some are distressed and some are in default. Treating them all as equal is financial malpractice.

It also explains why Mmarketing has lost credibility. While the rest of the C-suite speaks in terms of risk-adjusted return, marketing speaks in impressions, clicks and brand lift.

If marketing wants its seat back at the table, it must pivot from storytelling to underwriting. It must quantify risk exposure to share erosion, category decline, and profit pool compression. It must stress-test intangible assets like brand equity and reputation. And, it must present diagnostics that show how GTM reduces enterprise risk.

Accountability and enforcement

This raises the sharpest question: who is accountable when GTM debt is misrepresented, and how is that accountability enforced beyond simply firing people?

The answer is clear under post-2022 Delaware law. Officers — the CMO, CRO, CFO and CEO — have personal duties of candor and oversight. They are exposed if they misstate CAC or present speculative LTV as fact. Boards are accountable too: if they rely on bad numbers without probing, they are guilty of oversight failure. And shareholders are the injured party, empowered to bring derivative suits in the company’s name.

This can lead to litigation. SEC and regulatory scrutiny can escalate misrepresentation into securities fraud. Boards can claw back bonuses and equity earned under false reporting. Insurers can strip officers of indemnification. And reputational damage can end an executive’s career.

For decades, GTM reporting failures were dismissed as incompetence. Delaware 2023 changed that. Misrepresentation is now a governance breach with legal teeth.

Growth is not free — it’s debt

The message for CEOs and CFOs is blunt: GTM is not OpEx, it is not equity-style risk capital, it is debt. Fully loaded CAC is the principal. Velocity is the interest rate. Churn is default. Time decay and opportunity cost are the basis of recourse.

And the ultimate question is unavoidable: Are you underwriting GTM debt responsibly, or are you handing out bad loans in your shareholders’ name? In the old world, a bad answer meant wasted spending. In today’s fiduciary environment, it can mean litigation, clawbacks, regulatory scrutiny and reputational ruin.

Growth is not free. It is a debt. And the era of pretending otherwise is over.