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Revenue recognition (Deferred account issue)

Apr 27, 2017 at 12:12 PM


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Former Member


We are having an issue in clearing deferred revenue account balances for contracts that are closed or cancelled.

Process followed is- a contract is created , invoicing is done and monthly revenue recognition is done.While creating invoice for this contract, we are using deferred revenue account. In each period revenue recognition is done to flow amount from deferred account into revenue account.

Issue is some contracts have been cancelled before end date for some reason .And the balances in deferred revenue accounts are still on that account distributed in each period.(Revenue recogni cat "D" is used)

Now client wants to move amount from deferred account to actual revenue account.

Any suggestions how this should be handled?

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