Learn more about the difference between Cash and Accrual methods for QuickBooks Online.
Cash and accrual are two methods of reporting income and expenses. The same report can paint a different picture depending on the method you pick.
When you use the cash method in reports:
- Your report will count income and expenses when you receive the payment or pay the bill.
- If you sent an invoice or received a bill but the money hasn’t changed hands yet, your report doesn’t include it in your income and expenses.
When you use the accrual method in reports:
- Your report will count income and expenses as soon as you send an invoice or record a bill.
- It will include income and expenses even if the payment has not been made.
Change the method on a report
To see the difference another accounting method will make in your reporting, you can customise an individual report to use a different accounting method and compare the results.
To change the method used on an individual report:
- Go to Business overview and select Reports (Take me there) .
- Select a report.
- Select Cash or Accrual under Accounting method (you can also select the Customise button to open the Customise Report window and change the setting in the General section).
- Select Run report.
Talk to an accountant about which method is most appropriate for your company. For more information, visit find an Accountant page.