I’ll try to explain by looking at only the resulting GL transactions that result and in terms of there timing.
Using the courier services company example that @Brucanna presented in the OP. The Courier company may provide, say, 10 deliveries to one of their customers over 2 months and then invoice the customer at the end of the 2nd month. The delivery driver would enter these into the system using a process similar to billable time, but as @Brucanna suggested, called Billable Services.
First Step: 6 entries with resulting GL entries (6 in all for month of August)
Debit - Billable Services control account
Credit - P&L Revenue account
Lets say that each delivery was $50 and this is their only customer. At the end of August B.Serv. control account would show a balance of DR$300 which is a current asset (a substitute for AR). The end of August reports are now recognising the un-invoiced income saving the process off creating an End of Period journal to recognise this accrued revenue as well as providing the streamlined effect of having to create fewer invoices.
In September a further $200 (4 @ 50) has been added to B.Serv. and an invoice is created for $500 moving it to AR account.
Debit - Accounts Receivable
Credit - Billable Services control account.
Now let’s look at the second example (annual up-front fee). Step 2 (in first example above) now becomes step 1 and Step 1 becomes step 2 (as correctly stated by @Brucanna in the most recent post) with a time lapse of 12 months where the Billable Services account will have a diminishing credit balance, representing a current liability in the balance sheet, when in fact, it would be the Billable Services control account which would be in the current asset section of the balance sheet (assumption on my part). So, this is the difference between example 1 and 2. Example 2 would need to have a control account in the current liability section of the Balance sheet whereas example 1 would need a control account in the Current asset section of the balance sheet.
Having items appear in incorrect sections of the Balance sheet can have ramification for the calculation of financial ratios such as the Working Capital ratio.
Example using these Balance sheet amounts:
Bank DR 10,000
AR DR 12,000
Billable Services DR 6,000 (debit amounts $10,000, credit amounts $4,000)
AP CR 8,000
Working Capital Ratio is 28,000 / 8,000 = 3.5
If the credit amount residing in Billable services is transferred to current liabilities then:
Working Capital Ratio is 32,000 / 12,000 = 2.667
I am in full support of this idea, but in terms of the proper presentation of financial reports, it needs to recognise the difference between example 1 and example 2, and either be split into 2 separate ideas or have some mechanism to differentiate so as to place amounts in the correct sections of the balance sheet.