#Accrual

[zehpeh]

"ACCRUAL" - acrylics/ink/digital - October 2023

[rlewisphilly]

This one is on the money!

National Accountant Day!  A learning moment about your finances:A fine is a tax for doing something wrong. A tax is a fine for doing something well. Yes, I’m a little late in filing (like 1.6 million people with their taxes) the day was Sunday! I hope you were nice to an accountant on their special day. Remember, it’s accrual world out there.

[priceperplayer]

PricePerPlayer.com Pay Per Head Software Tutorial – Player Payments and Transactions

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[silvermoon424]

How is your new job going so far?

Thanks for asking!! I'm doing okay, but it's kind of overwhelming. Not just because it's a new job, but because a lot of the processes are super convoluted (basically, people kept slapping on bandaids instead of actually trying to rebuild the systems to be more streamlined and coherent). It's also kinda hard because I only have 3 coworkers in this department (1 of which is very recent as well), so there aren't a ton of guides on how to do things bc it just wasn't needed until recently.

Despite feeling overwhelmed a lot of the time, I will say that my coworkers have been really great about emphasizing that we'll be taking things slowly. More of it is starting to make sense and it helps knowing that they don't expect me to know and do everything right off the bat. They're very willing to let me work and learn at my own pace.

[angustully]

how do i explain to the very nice people in my life who are completely able and willing and insistent upon giving me a ride to/from work that i basically treat the "ride to work" as PTO. i accrue one ride to work for every 5 days that i walk myself to work. on days that i feel healthy and the weather is not dangerously cold i will not use a ride to work, i will save it in my ride to work bank until such a day comes that i dont feel like walking or the weather is so bad that walking could kill me. i do not deserve to use ride to work willy nilly as i please, i must earn it by getting myself there as much as humanly possible on my own two legs. thank you for understanding, please stop pushing me to explain why i would prefer to walk most days because the only answer is I FEEL GUILTY!!!!!!!

[mariacallous]

I had bagel sandwiches for breakfast and lunch and now I’m going to go back and nap for a while because I’ve earned all of this.

[xannerz]

there's a remote state job that's hiring and the pay range is rly tempting, but i've been so spoiled by unlimited pto w my current job that it's like really hard to wanna go anywhere else 😬

[shuraatax]

Accrual Accounting vs. Cash Basis Accounting

Choosing the proper accounting method is essential for every business. The two most common approaches are Accrual Accounting vs. Cash Basis Accounting. Each has distinct advantages, and the decision will depend on your business size, complexity, and financial reporting needs.   

In this blog, we will explore these two methods in depth, helping you understand their differences, benefits, and how they affect your business finances. 

[neona]

yooooo Mermaid-Idol character in TL:I

and ofc a bajillion changes as always, hilarious that this is the only game I play where they're like "we're simplifying things" and I'm like yeah that's fair

I hope the monetization changes are enough to improve success in the west

[5516-minutes]

went to the park earlier and there were two chicks trying to parallel park in front of my car so i offered to help... my ass didn't specify i meant to help by directing the car so when the driver got out so i could park it i was bricking it... but then i remembered i was wearing a ferrari kit so i did it (＊ﾟ∀ﾟ)=3

[pollys01]

Learn about why accrual accounting is the best HOA accounting method for your HOA. This video explains the advantages of accrual accounting over other methods, helping you manage your HOA's finances more effectively. For more detailed information, visit this detailed blog, Why Accrual Accounting is the Best HOA Accounting Method for Your HOA. Perfect for HOA board members and property managers looking to improve financial transparency, this guide will help you make informed decisions. Watch now to discover the best accounting solutions for your HOA!

[empxtrack]

This article explains the significance of paid time off, the different PTO models and provides insights into how to calculate PTO accrual. 

[reedtinsley]

Cash Accounting vs Accrual Accounting in Healthcare

Accrual accounting in healthcare records revenues and expenses when earned or incurred, matching them to the period they relate to, providing a more accurate financial picture. Cash accounting, however, recognizes transactions only when cash is exchanged, potentially distorting cash basis net income. In medical accounting, accuracy is crucial, reflecting net income accrual basis for comprehensive financial analysis.

[accountingsikhehindime]

लेखांकन मे रोकड़ आधार और उपार्जन आधार मे अन्तर।

नमस्कार दोस्तो इस पोस्ट मे आज हम जानेगे की लेखांकन मे रोकड़ आधार और उपार्जन आधार मे अन्तर क्या है। दोस्तो लेखांकन मे जो लेखा प्रविष्टिया की जाती है। वह लेखांकन आधार पर की जाती है। जो दो प्रकार के होते है। जिसके बारे मे आज हम इस पोस्ट मे विस्तृत रूप से जानकारी प्राप्त करने वाले है। इसलिए दोस्तो आप पोस्ट को शुरू से End तक जरूर पढे।  रोकड़ आधार और उपार्जन आधार मे अन्तर। लेखांकन (Accounting) के आधार…

[georgeshutcheson]

The Basics of Accounting Method

New Post has been published on https://www.fastaccountant.co.uk/accounting-method/

The Basics of Accounting Method

In this article, you will learn about the different types of accounting methods, including Cash Accounting, Accruals  Accounting, and Simplified Accounting. The article breaks down each method’s context for VAT versus Income Tax and Corporation Tax, giving you a clear understanding of their applications. Whether you’re a VAT registered business or a sole trader/partnership for Income Tax and Corporation Tax, this article provides valuable insights into which accounting method may be most suitable for your business. With clear examples and eligibility criteria, you’ll gain a solid understanding of the basics of accounting method and how it can impact your tax liabilities.

Cash Accounting

Definition and Context

Cash Accounting is a method of reporting financial transactions based on when they are paid or received. This means that revenue and expenses are recorded when cash is actually exchanged. It is commonly used for VAT reporting purposes.

Reporting Transactions for VAT

When using Cash Accounting for VAT, transactions are reported according to the date they are paid or received. This means that if you receive payment from a client in June, you will report that revenue in the same period. Similarly, if you make a payment to a supplier in July, you will report that expense in the same period.

Eligibility and Benefits

To be eligible for Cash Accounting for VAT, your turnover must be less than £1.35 million. This accounting method is often simpler and more logical for small businesses, as it aligns with the cash flow of the business. It allows for more accurate reporting of revenue and expenses based on when the cash is actually received or paid.

HMRC Guidance

HMRC provides guidance on Cash Basis Accounting for VAT, which can be helpful for understanding the specific requirements and rules associated with this accounting method.

Accruals Accounting

  Definition and Context

Accruals Basis Accounting, also known as invoice accounting, is a method of reporting financial transactions based on when they are earned or incurred, rather than when cash is exchanged. This method is commonly used for reporting transactions for Income Tax and Corporation Tax.

Reporting Transactions for Income Tax & Corporation Tax

When using Accruals Basis Accounting for Income Tax and Corporation Tax, transactions are matched to the period they relate to. This means that revenue is reported when it is earned, regardless of when the cash is received, and expenses are reported against the period the expenses is incurred, rather than when they are paid.

Comparison between Cash Basis and Accruals Basis

Differences in Reporting Transactions

The main difference between Cash Accounting and Accruals Accounting is the timing of when transactions are reported. Cash Basis Accounting focuses on when cash is exchanged, while Accruals Basis Accounting focuses on when revenue is earned and expenses are incurred. This difference can have an impact on the financial statements and taxation of a business.

Advantages and Disadvantages of Each

Cash Basis Accounting offers simplicity and ease of use, especially for small businesses with straightforward cash flow. It provides a clear picture of the cash position of the business and allows for more accurate reporting of revenue and expenses as they occur.

Accruals Basis Accounting, on the other hand, provides a more comprehensive view of the financial performance of a business. It matches revenue and expenses to the period they relate to, providing a more accurate reflection of the business’s financial position. However, it can be more complex and requires careful tracking of income and expenses.

Choosing the Right Accounting Method

When deciding on the accounting basis for your small business, there are several factors to consider. Firstly, consider the size and complexity of your business. If you have a simple cash flow and do not deal with suppliers on credit terms, Cash Basis Accounting may be the most suitable option.

However, if your business involves transactions on credit or you need to match income and expenses to specific periods, Accruals Basis Accounting may be more appropriate. Additionally, consider the eligibility requirements and restrictions for each accounting basis, as well as the guidance provided by HMRC.

Separate Accounting Method for VAT and Income Tax

It is important to note that you are not required to use the same accounting basis for VAT and Income Tax. If Cash Basis Accounting works well for your VAT reporting, but you prefer to use Accruals Basis Accounting for Income Tax, you have the flexibility to do so.

Future Changes in Accounting Method

Proposed changes in the Autumn Statement 2023 announced that Cash Basis would become the default for unincorporated businesses, with the option to elect into Accruals Accounting. The thresholds for entry and exit would be abolished, and the restrictions on offsetting losses and finance costs under Cash Accounting would also be abolished.

These changes could have significant implications for unincorporated businesses and may impact their choice of accounting method in the future.

Simplified Accounting

Simplified Accounting is an HMRC scheme designed to simplify some expenses for small businesses under Self Assessment for Income Tax. It covers expenses such as vehicle costs, working from home costs, and expenses related to living on your business premises.

HMRC provides guidance on Simplified Accounting, which can be helpful for understanding the specific expenses that are covered and how to use the simplifications effectively.

Self Assessment Return

When submitting your Self Assessment return, it is important to consider the default treatment for cash accounting. In most cases, the treatment happens automatically based on the accounting method you have selected. However, if your circumstances are more complex, it may be advisable to seek advice to ensure accurate reporting.

Conclusion

In conclusion, Accruals Accounting and Cash Accounting are two different methods of reporting financial transactions. Each has its own advantages and disadvantages, and the choice of accounting basis depends on the specific needs and circumstances of a business.

When deciding on the accounting basis, consider factors such as the size and complexity of your business, the nature of your cash flow, and the eligibility requirements and guidance provided by HMRC. It is also important to stay informed about any proposed changes to the accounting basis that may impact your business in the future.

By choosing the right accounting basis and understanding the reporting requirements, you can ensure accurate and compliant financial reporting for your business.