Deferred Revenue

Hi,

I’m wondering if anybody could offer any advice on the best practice for our situation.

Currently we Invoice our customers at point of signed order as a request for payment but defer revenue until delivery date. (Not in Epicor at the moment as other departments are still being implemented)

Is there a way of adding the delivery date to the revenue recognition process as our options show as Invoice and apply date only?

If anybody has a similar scenario, i would be grateful to hear how you handle in Kinetic.

Do you have the Deferred Revenue Module and/or the Project Module? We’ll need more information about your business and how it works.

I moved this to its own thread. Welcome to the EpiUsers!

Thankyou!

We have Deferred Revenue module enabled but not Project management.

OK. The Project Module is designed to recognize revenue based on activities (Milestones, etc.). The standard Deferred Revenue module seemed more time-based. For example, if I were selling a service that is invoiced up front and then amortized throughout the year, then one would enter the invoice. The full amount goes to deferred revenue. On the invoice, you set the amortization schedule. When you run the Revenue Recognition program, it moves the allocated amount for that period from the deferred account to the sales account. Details in the DRA Hierarchy listed below. Each invoice line has its own amortization schedule:

Deferred Revenue Accounting Transaction Hierarchy Guide

Thank you for this, it seems like I will need to explore the Project Model and other functions.

We manufacture bespoke products on a lead time of two to three weeks, in general, but do have special orders that can take up to three months. We Invoice on order and our customers pay in full before we start the manufacture process.

We also have account customers who pay 30 days EOM but as these customers are Invoiced on delivery of goods so no deferment is required.

I’ve read a little about advanced billing, and have used Proformas in the past on another system, but we had complaints as customers got confused when a second Invoice (the VAT Invoice) was sent at point of delivery causing some customers to pay again. Does advance billing work in this same way and send a second Invoice. If it doesn’t then this option could possibly work for us?

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@Amy-MFT Welcome. Advance billing will show the prepayment which for us is auto applied unless we change it on the second invoice with the balance deducted by the prepayment.

You need the license for sure, there is master to define how much you need to recognize periodically and on what date for the FY.