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E
Ericcohen
December 4, 2018
Question

Cash Basis Journal Entry

  • December 4, 2018
  • 4 replies
  • 34 views

When posting a manual Journal Entry (db. Expense & cr. Accrued Expenses), it always shows up in Cash & Accrual Reporting.  However, I want to be able to record accrued expenses without running them through AP.  Is there any way to post a Journal Entry for just Accrual Basis Books and not show up on the Cash Basis besides through AP?

    4 replies

    john-pero
    john-pero
    Level 12
    December 5, 2018

    If you enter a Vendor Bill it will be a current expense under Accrual but will not show in Cash accounting until you pay it. Same with income, record an Invoice and under Accrual it is today's income even if customer never pays you.

     

    What you have to realize is that journal entries bypass the distinction between cash and accrual

    M
    Malcolm Ziman
    Level 4
    December 5, 2018
    @john-pero wrote:

     

    What you have to realize is that journal entries bypass the distinction between cash and accrual

     

    Just yesterday there was a discussion about this.  It seems that in Desktop it depends on which entry is on the first line of the JE, which seems to be a way to control this, but in QBO it makes no difference which entry is on the first line 

    https://community.intuit.com/questions/1782280-my-clients-are-on-a-cash-basis-is-there-a-reason-that-all-of-a-sudden-my-journal-entries-are-not-showing-up-on-a-cash-basis-report-but-they-are-on-an-accrual-basis?jump_to=comment_3701207

      A
      Arif3
      May 1, 2020

      The link shown above is no longer valid and I can't find the response. Is someone able to provide the new link to this resource?

      M
      Malcolm Ziman
      Level 4
      December 5, 2018
      @Ericcohen wrote:

       Is there any way to post a Journal Entry for just Accrual Basis Books and not show up on the Cash Basis besides through AP?

      I tried a zero Bill with expense on 1st line and other current liability account on the 2nd line as a negative to offset, which you would think would work but does not. The expense still shows up on a cash P&L.  So it seems there is no choice but to go through AP

      E
      EriccohenAuthor
      December 5, 2018

      Yeah, I have not found a workaround which is pretty frustrating.  There are times we need to record items outside AP and show in other liability accounts.

        qbteachmt
        qbteachmt
        Level 11
        December 5, 2018

        AP and "accrued expense" are the same thing; the purpose of AP is to Accrue Expense to be paid later.

          M
          Malcolm Ziman
          Level 4
          December 5, 2018
          @qbteachmt wrote:

          AP and "accrued expense" are the same thing; 

          Not always. Eg. You may want to accrue salaries & wages.  That is not AP

            C
            ChristopherCPA
            August 12, 2022

            I’ve been using a workaround that seems to do what the client needs. I’ve created a location called “Accruals” and I add this to the line items of journal entries that I want only to show on an accrual report. When I want to run a true cash basis financial statement, I just click the “cash” radio button and then customize the report to remove transactions with the “Accruals” location, and it works!

             

             So I maintain the books on cash and book those adjusting entries to convert to accrual. We also use bills/invoices, but that only goes so far. Far easier to use AJEs for most accruals.

             

            Hope this helps!

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