A Cutoff Procedure and Counterterms for Differential Renormalization
  Explicit divergences and counterterms do not appear in the differential renormalization method, but they are concealed in the neglected surface terms in the formal partial integration procedure used. A systematic real space cutoff procedure for massless $\phi^4$ theory is therefore studied in order to test the method and its compatibility with unitarity. Through 3-loop order, it is found that cutoff bare amplitudes are equal to the renormalized amplitudes previously obtained using the formal procedure plus singular terms which can be consistently cancelled by adding conventional counterterms to the Lagrangian. Renormalization group functions $\beta (g)$ and $\gamma (g)$ obtained in the cutoff theory also agree with previous results. 
D.Z.Freedman, K.Johnson, R.Munoz-Tapia, X.Vilasis-Cardona