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WHAT IS THE ACCOUNTING PRINCIPAL USED FOR REPORTING FINANCIALS IN ACCRUAL BASIS?

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تم إضافة السؤال من قبل Nani Botsile Phirinyane , REGIONAL ACCOUNTANT , BOTSWANA UNIFIED REVENUE SERVICE
تاريخ النشر: 2014/10/22
Ashraf     CMA    CIA
من قبل Ashraf CMA CIA , group financial control manager , retail & trading group

1- Matching concept

2- Revenue recognition

ibrahim abdallah
من قبل ibrahim abdallah , Audit Manager , Raja School

I totally agree with Dennis the accrual principle is the principle, and you have to choose between them either you go with cash method which is applicable in small business or accrual method when you have a considerable turn over.

so by definition the difference between these two methods is the timing of revenues and expenses.

does this help you> hope so.

Dennis Marquez, CPA, CMA, CIA
من قبل Dennis Marquez, CPA, CMA, CIA , Financial Controller , Group Enterprise Services Ltd.

I'm sorry I'm confused with the question.  The Accrual Method of Accounting is the principle itself.  Which means revenue are recognized when earned, not when cash is collected as in contrast with the "Cash Method", and expenses are recognized when incurred and not when payment of cash is paid.  I hope that helps.

Thanks.

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