Accruals accounting: Difference between revisions
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''Financial reporting - accruals concept''. | ''Financial reporting - accruals concept''. | ||
Accruals accounting means accounting by applying the accruals concept of including revenues, profits and the associated costs incurred while earning them in the same accounting period's profit or loss account or income statement. | Accruals accounting means accounting by applying the accruals concept of including revenues, profits - and the associated costs incurred while earning them - in the same accounting period's profit or loss account or income statement. | ||
For example, the total cost of an asset with a long useful life is spread for accounting purposes over the whole of its useful life. | For example, the total cost of an asset with a long useful life is spread for accounting purposes over the whole of its useful life. | ||
| Line 17: | Line 17: | ||
* [[Amortisation]] | * [[Amortisation]] | ||
* [[Assets]] | * [[Assets]] | ||
* [[Big bath]] | |||
* [[Cash accounting]] | |||
* [[Consistency]] | * [[Consistency]] | ||
* [[Deferred income]] | * [[Deferred income]] | ||
| Line 24: | Line 26: | ||
* [[Going concern]] | * [[Going concern]] | ||
* [[Income statement]] | * [[Income statement]] | ||
* [[Matching]] | |||
* [[Profit and Loss account]] | * [[Profit and Loss account]] | ||
* [[Prudence]] | * [[Prudence]] | ||
[[Category:Accounting,_tax_and_regulation]] | [[Category:Accounting,_tax_and_regulation]] | ||
Latest revision as of 17:31, 20 August 2024
Financial reporting - accruals concept.
Accruals accounting means accounting by applying the accruals concept of including revenues, profits - and the associated costs incurred while earning them - in the same accounting period's profit or loss account or income statement.
For example, the total cost of an asset with a long useful life is spread for accounting purposes over the whole of its useful life.
Contrasted with the cash basis of accounting, which takes account only of receipts and payments in the accounting period.
