HaloPSA Guides

In this guide we will cover:

- How to set up Deferred Revenue

- Invoicing for Deferred Revenue

Halo has the ability to configure deferred revenue for Pre-Pay, with expansions beyond this in the near future. This is designed to handle the scenario in which you have taken payment for a service and the revenue cannot yet be recognised because (for example) you may take payment in January for work that is not carried out until May, so to accurately account for the revenue you may want to defer the revenue. 

Setting up Deferred Revenue

The first thing to do is enable the setting (Configuration>Billing>General Settings>*Click into the Deferred Revenue Tab*):

Fig 1. 'Enable Deferred revenue' setting

Before configuring this, please make sure the following has been configured correctly:

1. The setting within Configuration > Time Management is disabled:
   
   

Fig 2. 'Actions cannot be invoiced until Timesheets are approved' setting

While disabling the above setting is not required for Deferred Revenue to function in Halo, if this setting is enabled then Deferred Revenue Invoices will not become available until after timesheets are submitted and approved

2. This option within configuration > Billing > Charge Rates, is set to 0 (disabled) or populated with a number:
Fig 3. Charge rate override setting

3. Enable the Deferred Revenue checkbox in billing general settings

4. Select a Deferred Revenue Customer (screenshot above) - Selecting a Customer record here will mean that invoices that are generated with the purpose of allocating Deferred Revenue will be created against the customer selected in this option. If no customer is selected here, the invoice generated for allocating Deferred Revenue will be created against the client that the work has been completed for.

5. Set an 'Item to use for Pre Pay and Deferred Revenue Invoice line' - this will be the product record used for 'topping up' & allocating Deferred Revenue. The product selected here should have it's income account set to your Deferred Revenue account code.

Invoicing for Deferred Revenue

When a Prepay amount is added and invoiced the invoice will be created with the Deferred Revenue item selected above. This is how Deferred Revenue amounts are added to, therefore, if integrating with a 3rd party accounting application this Item/Product should have a default account that is your Deferred Revenue account.

When time is logged to the Prepay Contract for the Customer (and is considered ready for invoicing) this time will appear in the "Deferred Revenue Pre-Pay" list (as below)

Fig 4. Deferred revenue in Ready for invoicing

If an invoice is generated it will be created for the Deferred Revenue Customer (if set) and will contain a negative line amount and a positive line amount. The Deferred Item will be used for the negative line item to draw the amount from that liability account, and the Charge Type Item based on the labor performed on the ticket will be the positive amount transferring the balance to that items Income account.essentially "recognizing" that revenue from liability to income.

This will have the effect of decreasing some or all of the Deferred Revenue Account and increasing the Product Income Account and this amount of revenue will be "recognised".

Fig 5. Deferred revenue invoice