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Getting paid and earning revenue are two different events. You earn revenue by delivering the service. You get paid whenever the customer pays. Revenue recognition tracks the first; payments track the second. So a payment never changes recognized revenue. When a customer pays, Lago moves the amount from accounts receivable (money owed to you) to cash (money you hold). Revenue was already recognized when the service was delivered.

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A payment doesn’t move revenue

A customer is invoiced $1,200 on January 1 for January service and pays on January 20. The revenue is recognized daily across January regardless of when they pay.

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Partial and multiple payments

If a customer pays in installments, each payment moves its share from receivable to cash. None of them affect recognized revenue. The receivable simply shrinks with each payment.

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When a payment is late

If an invoice goes past due, Lago writes the full unpaid amount off as bad debt (see Disputes and failed payments). If the customer later pays, Lago reverses that write-off in full: the cash arrives and the bad debt is recovered. Recognized revenue still doesn’t change, because the revenue was earned when the service was delivered.

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What this means for your reports

  • Payments don’t appear in the Recognized Revenue report.
  • They show up in the Statements as a shift from receivables to cash.
  • If recognized revenue and cash collected don’t match for a period, that’s expected. The gap is your outstanding receivables and deferred revenue, not an error.