Accrual
In accounting, accrual means an expense incurred, or revenue earned, before it is invoiced — recorded at period end so it lands in the right period.
- Layer
- Lexicon
- Defined in
- Lexicon
- Components
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- Nearby
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Authority
This definition follows Accrual basis; ASC 405.
Every citation in this system, with the text we read and the date we checked it, is in US GAAP and where these rules come from.
The lesson that teaches this
Accounting, 0 to 1 — a free course taught end to end on one month of one company, with the spreadsheet exercises to work it yourself.
Accrual, in use
Quoted from the 10 documents that use the word — what it does to an interface, in the spec's own sentence.
The statement header carries the full context: entity, statement type, resolved period, basis (cash/accrual), presentation currency, and generation timestamp.
Templated by adjustment type — accrual, deferral, depreciation, amortization, provision, reclass, true-up. autoReverse defaults to true for accruals, with the reversal date shown inline ("Reverses 1 Oct 2026").
An accrual that doesn't reverse double-counts the expense when the real invoice arrives and is coded to expense.
Schedules, accruals & roll-forwards — 3. Accrued liabilities
For founders
The same idea written for a founder: what it costs a startup that ignores it, and what to do in a real month.
- Accrued expensesCosts you've incurred by month end but haven't been billed for yet, like legal work, usage-based software or payroll that spans the month end.
- Cash vs accrual accounting for startups, and the IRS ruleCash or accrual for a startup: why investors and auditors read accrual, when the IRS lets a C-corp file on cash, and the 2026 gross receipts limit.
- Accrued expenses vs accounts payable: the differenceAP is a bill you’ve received; an accrued expense is a cost incurred before the bill arrives. When to accrue, and how reversing entries work, by example.
- How to read an income statement (P&L)Revenue, cost of revenue, gross margin, operating expenses and net income, read line by line, on accrual basis, with the mistakes founders make most.
What it is not called
Each of these is a real word for a different thing. Using it here is what makes a product read as though it was built by someone who has not done the work.
- estimate
Components that render this
The concept is not documentation-only. These are the components that name it in their specification, grouped and stated exactly as the catalog states them.
Nearby in the catalog
Components in this part of the system that no term names outright. A weaker claim than the list above, and stated as one — but a component nothing links to is a component nobody finds.
Terms this one depends on
- ExpenseOutflows or using up of assets, or incurrences of liabilities, from delivering goods or services — recognized when incurred, not when paid
- RevenueInflows or enhancements of assets, or settlements of liabilities, from delivering goods or services — recognized when control transfers, not when cash arrives
- PeriodA fiscal reporting window
Also in Close
Work with this concept
The calculators that compute it and the ledger payloads that carry it. A definition is where a reader starts; these are where they go next.
- Prepaid & deferred releaseA premium paid on the 17th does not release in twelve equal slices. Day-weighted, or even — your call.Tool
- Day count & proration30/360 is wrong about the calendar and right about the contract. Both are here.Tool
- Accrual vs deferralAn accrual records revenue or expense before the cash moves; a deferral records cash that has moved before the revenue or expense is recognized — accruals create receivables and payables, deferrals create prepaids and deferred revenue.Compare
- Journal entry for accrued expensesAt month-end, debit the expense and credit Accrued expenses for work received but not yet billed. Reverse the accrual on the first day of the next month, then book the vendor's bill as usual when it arrives.Entry
- Journal entry for accrued wagesAt month-end, debit Wages and salaries and credit Accrued wages for the days worked since the last payday. On payday, reverse the accrual or debit Accrued wages for the part of the payroll it covers.Entry
- Journal entry for accrued interestAt month-end, debit Interest expense and credit Accrued interest for the interest earned by the lender since the last payment. When the payment is made, debit Accrued interest and credit Cash.Entry
Defined in Lexicon. This page is generated from that document, so the two cannot disagree.