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Does the button function not work if the client script is deployed as a script record instead of setting it on the form using form.clientScriptFileId?

You can have a script that is deployed for functionality such as pageInit that also has button functionality but you still need to add it via the form.clientScriptFileId and potentially the usual route with a User Event.

Isn't it weird? Script is already deployed yet it doesn't find the button function.

I set it via clientScriptFileId property and it is now working. Script is also deployed.

I don't find it weird, a bit inconvenient? Maybe. :blush:
It's probably related to how it hooks up the default functions, you're adding custom functions which I assume it's not advanced enough to interpret.

Thanks for your help confirming that I am doing it right.

form level client scripts have their own button related functionality

its not the same as the button added via user event scripts