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As our business grows this is a critical element we need for our reporting, I am surprised reading all the comments this is not even been considered by Xero.

very very helpful as we charge many income in advance invoices

We also run a SaaS business and find the inability to record basic details like subscription start date and end dates very frustrating. Ultimately, we will be looking for the next generation of general ledgers that can cater for a growing software business unless there can be some incremental progress on this topic..

Would it be possible to always have a journal automatically updated, to account for ALL Draft Invoices as:

dt. Deferred Income
cr. Sales (the specific sales account as indicated in the draft invoice)

I imagine this being an automated journal that updates as soon as a new invoice is saved to drafts, and also removed from the journal when it is approved.

it is that critical that other ventures (like flowrev) are creating it as a layer to add on top of xero, please let us know if you are planning on developing such a feature

being able to recognise the revenue from an invoice over a defined furture period, is requested time and again from our clients and many wont move to xero because this function is lacking. Is this idea actually being considered?

Would it be possible to always have a journal automatically updated, to account for ALL Draft Invoices as:

dt. Deferred Income
cr. Sales (the specific sales account as indicated in the draft invoice)

I imagine this being an automated journal that updates as soon as a new invoice is saved to drafts, and also removed from the journal when it is approved.

Critical ,

We are Xero partners and we are losing clients due to lack of this feature

It's breaking my heart because I love Xero and hate the QBO ecosystem, but this is likely the feature that's going to make me have to switch away. What a bummer.

Would it be possible to always have a journal automatically updated, to account for ALL Draft Invoices as:

dt. Deferred Income
cr. Sales (the specific sales account as indicated in the draft invoice)

I imagine this being an automated journal that updates as soon as a new invoice is saved to drafts, and also removed from the journal when it is approved.

SaaS businesses Have to have this as a feature of their accounting package. All US companies had to adopt ASC 606 from 2019.

the basic principle of ASC 606 / IFRS 15 is to “recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services.” It needs to be recognised on a daily basis.

To keep these calculations in excel and to have multi currency becomes extremely convoluted and the risk for formula errors are very high, which could lead to material errors in the revenue recognition.

Not having this capability will ultimately force us to look at alternative solutions for our business

As a SaaS business yourself and in the current economic environment I am quite surprised this has not received the required attention.

We are an events DJ company that often have clients booking us a year in advance. In order to comply with bookkeeping and accounting best practices and actual reporting requirements, this is a feature that is critical. Worst yet, the profit and loss report and the sales transaction reports calculate total sales based on the invoice issued date, and not on the due date. We thought we could workaround this by setting the due date to the client's event date, but then we have discovered that the invoices are still showing under the current year's data which totally goes against the revenue recognition principal.

Please, please, please, please, please implement this feature ASAP.

We are a DaaS business and like others bill some customers monthly by Direct Debit which is fine, but for those that won't sign a mandate, they pay quarterly or annually in advance, however from a metric perspective it is important we accrue revenue in equal monthly installments. Currently have to book the invoice to a customer prepayment account on the balance sheet and then manually journal from there to revenue each month. The ability to set up the revenue recognition schedule at the point of issuing the invoice itself so avoiding the manual journals would make a huge difference

Accruals should be able to be assigned to an invoice or customer. And have more features available for manual J/E. Also, there is no training or information on your website for Accruals. Please add training for accruals.

Deferred Revenue Recognition

When a multi-period sale invoice is booked there should be a feature which enables the user to recognize the revenue over multiple periods. Perhaps two additional columns can be added to the invoicing input screen where the user can enter the start and end date of the term to facilitate the calculations. If changes are made to the original invoice then the user should have the option to automatically or bulk adjust the prior prorations.

This feature would be useful to multiple businesses that sell multi-term services and are required by accounting rules to recognize the revenue proportionally over the life of the contract.

This feature can also be used on the Billing side to recognize prepaid expenses over multiple periods.

We are a SaaS business and we invoice all our clients in advance for one year therefore we have to do the deferred revenue and revenue recognition process every month. At the moment this process takes me two days to do using excel every month.

It is a critical feature, a third party doesn't really do it well. We will also need to make a change at some point if this cannot be solved within Xero.

We must have this feature - as others have commented. Luckily we also track all invoice activity in Salesforce and reconcile this to Xero every week. In Salesforce we have been able to build an FRS reporting dashboard to solve the revenue recognition, accrued and deferred revenues. It seems clear that to scale we will have to migrate from Xero as the product owners are not awake to this critical business issue.

Difficult to account for annual SaaS subscriptions using Xero right now.

I work for a subscriptions based business and the manual work involved in trying to deal with prepayments, paused and changed payments makes Xero unfeasible as the business scales up.