ScaleXP can easily automate your deferred revenue and accrued revenue journals.
Follow these steps to get started with your first journal.
Decide start date
Decide the date from which to start using ScaleXP automations. Things to consider are:
- A date after any financial close which can not be changed - usually this is your last year end, but it could be earlier or later depending on your circumstances
- A date which you can easily document as a starting point.
Ensure you have sufficient historic revenue data
Ensure that you have set your ScaleXP invoice import date early enough to include all invoices which have revenue to be recognised after the start date and that the revenue from these is being recognised correctly.
- In some cases it may make sense to upload this information manually instead.
- Contact support@scalexp.com for help and/or see How to add a manual invoice to adjust ScaleXP revenue recognition to match your accounting system.
Ensure you are happy with your revenue recognition
Review ScaleXP revenue recognition starting from the selected start date. See Configuring your revenue data upon initial setup.
Set your revenue recognition journal preferences
Find these in Journals (top tab) on any Revenue Recognition page: Accrued or Deferred Revenue.
Select the cog in the top right corner to see the Revenue Journal Settings.
You will then see the options for Revenue Journals.
If not already set this way for you, you may want to set your revenue recognition preferences to IFRS / US GAAP to avoid back-dated invoicing impacting prior months. Email support@scalexp.com to get this changed.
Set your default accounts for accrued and deferred revenue. If you have more than one deferred revenue account, go to the Deferred Revenue Journal page to set up deferred revenue account mapping.
Select to include Tracking Codes or Classes in your journal entries, if required. Contact support@scalexp.com for help with this if required.
Create accrued revenue, if required
Set up accrued revenue for any un-invoiced revenue to be recognised in the month. See How to automate accrued revenue journal posting, to add and release revenue accrual.
Review your first deferred revenue journal
See Deferred Revenue Journal: How to write deferred revenue journals to Xero or QuickBooks and
How the ScaleXP deferred revenue journal calculates the suggested posting amount.
Make a one-time adjustment to your deferred revenue balance sheet
If you have a long history of deferring a high volume of deferred revenue invoices, it is highly likely that your starting balance sheet will not exactly match the one proposed by ScaleXP. This will likely be the result of small differences in included revenue or the way it has been allocated across days and months.
Best practice is to make a one time adjustment to bring your starting balance sheet into alignment.
This will ensure clean, audit-friendly automated journals for all months going forward, fully supported by ScaleXP's detailed download backups. See How to download invoice line level detail behind the deferred revenue journal.
Read more about making a one time adjustment in How to adjust the starting balance sheet for deferred revenue.