Deferred revenue

Yes, every month, so the balance sheet figure and the schedule always agree.

Yes, the release schedule is updated to the new contract term from the renewal date.

It affects when income is recognised in your management books, not automatically your VAT treatment; your VAT position follows the tax point rules your accountant or adviser applies.

VAT is generally due at the earlier of invoice or payment, regardless of when revenue is recognised for reporting purposes, so a prepayment can trigger a VAT liability before any revenue is released from the deferred balance. We flag this timing difference so it is not missed on a return.

An upgrade is assessed to see whether it changes the remaining performance obligation, and the schedule is adjusted to reflect the new contract value over the remaining term, rather than simply adding the upgrade fee onto the existing schedule without checking the effect on timing.

They often look similar on a bank statement but are tracked differently: a deposit against future work is usually deferred revenue until that work is delivered.

The remaining deferred balance for that contract is adjusted out of the schedule in the month the cancellation is confirmed, with a note explaining the change.

Every deliverable under deferred revenue is reviewed by a senior reviewer before it reaches you. You keep access to the underlying file at every stage, so nothing about the work happens somewhere you cannot see it.

Deferred revenue covers deferred revenue schedule by customer and contract and monthly release calculated against delivery, usage or straight-line terms. The exact scope is agreed and set out in writing before work starts, so you know precisely what is and is not covered before the first deliverable arrives.