Deferred Revenues Recognition - Odoo Accounting

Deferred revenues, or unearned revenue, are payments made in advance by customers for products yet to deliver or services yet to render. Such payments are a liability for the company that receives them since it still owes its customers these products or services.
The company cannot report them on the current Profit and Loss statement, or Income Statement, since the payments will be effectively earned in the future. These future revenues must be deferred on the company’s balance sheet until the moment in time they can be recognized, at once or over a defined period, on the Profit and Loss statement.