Revenue Recognition (Deferred Revenue)

I am looking to find out anything and everything I can about Deferred Revenue. I am needing a pretty in depth instruction on how to attempt to set this up and need to know where to start. I am new to Epicor and want to make sure I understand what I am doing before I attempt to initiate changes within system.

Inside or outside of Projects?

  1. How do I verify if they are currently being set up though projects?

  2. What’s the difference within the system as far as why you would choose to do projects or not?

  3. Assuming outside of projects what would that look like?

Project Billing is generally Deferred Revenue by Default and you use the Project Revenue Recognition Program to move deferred revenue into revenue.

Outside of projects, an individual invoice has a checkbox “Deferred” and when you check that box, the revenue goes to the Deferred Revenue G/L account instead of a Revenue Account. You then set up schedules to recognize the revenue. On the invoice, you’ll notice an Amortization tab. This is where the schedule is stored.

So, for example let’s say we have a service that we sell for a 12-month period. The invoice goes to the customer for 1200 USD. You click deferred before you post and the 1200 USD goes to the Deferred Revenue Account defined in your Product Group or Company Default.

You then setup the Amortization schedule for 12 periods and use that schedule to create an Amortization schedule. Now, once a month you run the standard Recognize Revenue program and it posts once per month removing revenue from deferred to revenue until done.

Hope that makes sense.

Mark W.

Yes, this is so helpful!! Thank you. I will have more questions if you don’t mind me picking your brain a little bit.

We will defer them to another day. :wink:

Sounds good! Thank you.

Also I do see a Tech Guide on the EpicWeb for Deferred Revenue Accounting if you haven’t found that yet.

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This was exactly what I needed!

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Can anyone tell me if the deferred Revenue is an option that you have to pay for or if it is an option already installed within Epicor. The manual that I downloaded is making it sound like I have to go to eBack Office to get the module to be downloaded. I am just trying to figure out how to turn it on within my Epicor program if you will.