Deferred Revenue Basis Payment Receive Date

TheCA · ‎November 18, 2023

I am using deferred revenue recognition for a client and the Service date is unknown at the time of raising the invoice. There is a payment term the client has but sometimes payments are received 30-45 days later. How do I enter the Service date when it is not known or expected to change? Is it possible to automatically have the service date be the actual date when the Payment is Received? Thanks!

JuliaMikkaelaQ · ‎November 18, 2023

Thanks for bringing this concern here in the Community space, @TheCA. Let me share an insight about the service date and revenue recognition in QuickBooks Online.

Currently, the option to automatically have the service date be the actual date when the payment is received is unavailable. However, you can enter an initial service date and manually change it to the desired date when you receive the payment. Please note that in such cases, the revenue will be recognized as an income at the end of the month. Thus, it's best to adjust it accordingly.

Furthermore, you can check out this article to generate a revenue recognition report: Run reports in QuickBooks Online.

If you require additional assistance managing your invoices and revenue recognition, please feel free to comment below or visit the Community space. We're here to provide the best guidance and support to help you find the right solution for your every concern. Have a great day ahead!

View solution in original post

JuliaMikkaelaQ · ‎November 18, 2023

Thanks for bringing this concern here in the Community space, @TheCA. Let me share an insight about the service date and revenue recognition in QuickBooks Online.

Currently, the option to automatically have the service date be the actual date when the payment is received is unavailable. However, you can enter an initial service date and manually change it to the desired date when you receive the payment. Please note that in such cases, the revenue will be recognized as an income at the end of the month. Thus, it's best to adjust it accordingly.

Furthermore, you can check out this article to generate a revenue recognition report: Run reports in QuickBooks Online.

If you require additional assistance managing your invoices and revenue recognition, please feel free to comment below or visit the Community space. We're here to provide the best guidance and support to help you find the right solution for your every concern. Have a great day ahead!

TheCA · ‎November 18, 2023

Thanks, @JuliaMikkaelaQ for confirming that setting the payment date as the Service date automatically is not available by default in Quickbooks Online, and I need to manually go and update the service date.

A follow-up question since you mentioned reporting is that when I run the report by Tag Group, the deferred revenue entries do not show up even though the original invoice had the Tags from the Tag group?

AlverMarkT · ‎November 18, 2023

On behalf of my colleague, let me express my thanks as well, @TheCA. I'm here to provide insights on your follow-up questions.

Running invoice reports by tags in QuickBooks Online (QBO) generates a Profit and loss by tags report. Moreover, deferred revenues don't reflect on this report because they aren't recognized as revenue until they are earned.

Deferred revenues will reflect on the income statement only by the time they are earned, decreasing the liability and increasing the income. If the deferred revenues for the products or services are correctly set up, they will appear in the liabilities account when you run a Balance sheet report.

If you want to check out the billed and recognized amounts, you may browse this article on running a revenue recognition report: Run the Revenue Recognition report.

Additionally, I'm adding these articles to serve as a guide for future customization of your reports, helping you focus on what matters most.

You're always in the QuickBooks Community should you have further questions about deferred revenues or running reports in QBO. Take care.

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Deferred Revenue Basis Payment Receive Date