Deferred Credit(Deferred Liability)
Income received or recorded before it is earned, under the *accruals concept. The income will not be included in the *profit and loss account of the period but will be carried forward on the *balance sheet until it is matched with the period· in which it is earned. A common example of a deferred credit is a government grant. The grant is shown as a separate item or under *creditors in the balance sheet, and an annual amount is transferred to the profit and loss account until the deferred credit balance is brought to nil.
