What is Accrual accounting?
Finance & accounting. A plain-English definition for Australian business owners.
Accrual accounting recognises revenue when earned and expenses when incurred, regardless of when cash is received or paid.
It contrasts with cash accounting, which recognises transactions only when cash moves. Accrual accounting produces a more accurate picture of business performance over a period and is the default for businesses above the small business turnover threshold. Most cloud accounting systems support both methods.
In a connected back office this sits with the Finance hub, where Valont runs bookkeeping, managed payroll and bas & tax compliance for Australian SMEs as one team. The full definition set is on the glossary.
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General information, not advice. For how this applies to your business, talk it through with a Trusted Advisor or start with the Business Health Check.