Role cannot access a custom report even though the report is set to be accessible

Giving the role access to the custom report is not enough. The Role must have access to the Standard Report that the customized version was created from. In the case of the custom Scheduled Deferred Revenue report, the Custom A/P Clerk role must have at least the View Permission for Revenue Recognition Reports.

The permissions can be added under Setup > Users/Roles > Manage Roles > Edit/Customize the Role.