Deep Dives14 min read
Deferred Revenue Accounting for Client Prepayments
A client prepayment is not earned revenue on day one. Under ASC 606 and [IFRS 15](https://www.ifrs.org/issued-standards/list-of-standards/ifrs-15-revenue-from-contracts-with-customers), cash you receive before transferring the promised service is presented as a **contract liability**, often labeled deferred revenue, until the work is actually delivered.
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