I don't understand this at all! If there is nothing in payments received, why is there anything in income transfer? Isn't money passed on when received? What has potential got to do with it? Why would money due be in income transfer?

The Income transfer report includes money due but not yet paid to you by the guest, for bookings which have arrival dates that fall within the date range you select. This would include balance payments not yet received, for example. The Payments received column shows what you have actually received so far.