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𝗠𝗼𝘀𝘁 𝗰𝗮𝗻𝗱𝗶𝗱𝗮𝘁𝗲𝘀 𝗴𝗲𝘁 𝘁𝗵𝗶𝘀 𝘄𝗿𝗼𝗻𝗴 𝗶𝗻 𝗜𝗕 𝗶𝗻𝘁𝗲𝗿𝘃𝗶𝗲𝘄𝘀. When asked "what is deferred revenue?" the instinct is to say: "money you haven't received yet." That's the 𝘄𝗿𝗼𝗻𝗴 𝗮𝗻𝘀𝘄𝗲𝗿. And it costs people offers. Here's what interviewers at J.P. Morgan, Lazard and Goldman Sachs actually want to hear: Deferred revenue is cash you've 𝗮𝗹𝗿𝗲𝗮𝗱𝘆 𝗿𝗲𝗰𝗲𝗶𝘃𝗲𝗱 - but can't recognise yet, because 𝘆𝗼𝘂 𝗵𝗮𝘃𝗲𝗻'𝘁 𝗱𝗲𝗹𝗶𝘃𝗲𝗿𝗲𝗱 𝘁𝗵𝗲 𝘀𝗲𝗿𝘃𝗶𝗰𝗲. It sits as a 𝗹𝗶𝗮𝗯𝗶𝗹𝗶𝘁𝘆, not revenue. The obligation to deliver is still outstanding. Swipe through to see exactly how to answer it, including how it flows through all 3 statements. ↓ Follow The Analyst's Code for breakdowns on the most commonly asked Investment Banking Internship Questions. #InvestmentBanking #IBD #FinanceInterview #BreakIntoIB #SummerAnalyst