InterDigital Inc (IDCC)

[la-tsla-fan]

Olddog:

I should have known better than to delve into arcane accounting terminology.

However, now that I have jumped in, here is what I think are facts:

1. Deferred Revenue is a liability.
2. Accounts Receivable is an asset.

Based on 1 and 2, it may indeed be possible under the double entry system of accounting for both to be increased simultaneously.

What I am confused about is the distinction between amounts already collected and amounts due to be collected in the next 12 months.

I have been under the impression that Deferred Revenue represents the former, while Accounts Receivable represent the latter. However, in that case a simultaneous add to both accounts would not make sense. Funds already received should be under cash or short-term investments, not Accounts Receivable. On the other hand funds not collected yet should be in Accounts Receivable but not in Deferred Revenue.

There, I have exhausted all my knowledge of accounting (I took just one course in Accounting, and I know I did not do too well on it!)

Any words of wisdom from anybody would be appreciated.