Contract asset
In accounting, contract asset means revenue recognized ahead of an unconditional right to payment — the right still depends on something other than the passage of time.
- Layer
- Lexicon
- Defined in
- Lexicon
- Nearby
- 4
Authority
This definition follows ASC 606-10-45-3.
Every citation in this system, with the text we read and the date we checked it, is in US GAAP and where these rules come from.
Contract asset, in use
Quoted from the document that use the word — what it does to an interface, in the spec's own sentence.
Contract asset vs. contract liability are different balance sheet lines.
Schedules, accruals & roll-forwards — 4. Deferred revenue (ASC 606 / IFRS 15)
For founders
The same idea written for a founder: what it costs a startup that ignores it, and what to do in a real month.
- Deferred revenue for SaaS startups, explainedAn annual prepayment is cash today and revenue over a year. How deferred revenue works under ASC 606, why it’s a liability, and the schedule behind it.
- SaaS revenue recognition under ASC 606, step by stepASC 606’s five steps applied to a startup SaaS contract: annual prepay, implementation fees, usage and multi-year deals, with the entries.
What it is not called
Each of these is a real word for a different thing. Using it here is what makes a product read as though it was built by someone who has not done the work.
- unbilled receivable
- accrued revenue
Nearby in the catalog
No component names this concept outright. These are the ones in its part of the system, which is a weaker claim — but a component nothing links to is a component nobody finds.
6Statements
Family specTerms this one depends on
Also in Revenue recognition
Work with this concept
The calculators that compute it and the ledger payloads that carry it. A definition is where a reader starts; these are where they go next.
- Journal entry for deferred revenueWhen an annual contract is invoiced up front, debit Accounts receivable and credit Deferred revenue. As each month of service is delivered, debit Deferred revenue and credit Revenue for that month's share.Entry
- Journal entry for accrued revenueAt month-end, debit Unbilled receivables and credit Revenue for work delivered but not yet invoiced. When the invoice goes out, debit Accounts receivable and credit Unbilled receivables.Entry
Defined in Lexicon. This page is generated from that document, so the two cannot disagree.