Cash or accrual accounting is a financial reporting and tracking system used by businesses to record their income and expenses. This method of accounting allows for a more detailed and accurate reflection of what the company has earned, spent, and is owed. With cash accounting, all income and expenses are reported when they are received or paid. With accrual accounting, income and expenses are reported when they are earned or incurred. Both systems offer valuable insight into a business’s financial health, but one may be better suited to your needs than the other. Explore both methods to determine which makes sense for you!