What are accruals?
Accruals record income and expenses in the period they belong to, even when the cash moves later, such as wages, rent or interest not yet paid.
Last updated 29 October 2026
Accruals and deferrals
- An accrual comes before the cash. You record the income or expense now and receive or pay later, such as wages earned in March but paid in April.
- A deferral comes after the cash. You've already paid or been paid, and you record the expense or income later, such as prepaid expenses or customer deposits.
- Both exist so each period's results show what happened in that period, not just when money moved.
Common accruals at month-end
- Goods and services received on account but not yet paid for.
- Wages and salaries earned but not yet paid.
- Interest, rent and taxes owed but not yet paid.
- Sales made on account, where the customer pays later.
Why they matter
Without accruals, a month with a large unpaid supplier bill looks better than it was, and the month the bill is paid looks worse. Accrual accounting gives information about what a business owns and owes that you can't get from cash receipts and payments alone.
See how BeforeQuery's AI employees do this work, with a person approving anything that matters.
Book a demoQuestions
Are accruals the same as accrued expenses?
Accrued expenses are one kind: costs you've incurred but not yet paid. Accrued income is the other: income you've earned but not yet received.
What's the difference between an accrual and a prepayment?
An accrual records something before the cash moves. A prepayment is the reverse: the cash moves first, and the expense or income is recorded in later periods. Accountants call that a deferral.
Does BeforeQuery record accruals?
No. The AI Finance Agent tracks your month-end close checklist, including the accruals task, and reminds each owner in Slack before it's due. It doesn't post journal entries; the accounting stays with your team.
Hire your first AI employee
The AI Marketer is ready today, free to start. For your other teams, tell us which one needs an AI employee and we'll show you how it works with your tools.