Current vs Long-Term Deferred Revenue: How to Split the Balance
Deferred revenue that will be recognized within 12 months of the balance sheet date is a current liability; the rest is non-current (long-term). It matters for prepaid multi-year contracts.
Example: a customer prepays $48,000 on January 1, 2026 for two years of service. At September 30, 2026, nine months ($18,000 on an equal-months basis) have been recognized and $30,000 is deferred. Of that, the next 12 months (Oct 2026 – Sep 2027) are $24,000 current; the last 3 months ($6,000) are long-term.
DeferSheet computes the split per contract from the actual schedule (the amount recognized in the 12 months after your close month), and shows it on screen and in the workbook. When a contract also has unbilled amounts, the split applies to its net deferred balance.
Your auditor may ask for the same split as a reconciliation; the “By contract” sheet of the workbook gives it line by line.