Accrual Versus Cash Accounting is the process of recording financial transactions using either an accrual basis or a cash basis. With an accrual basis, transactions are recorded as they occur, regardless of when payment is received or made. On the other hand, with cash accounting, transactions are only recorded once payment has been received. This difference impacts how businesses monitor their finances and plan for future expenses, impacting the overall financial health of the organization. It’s up to each business to decide which method works best for them, allowing them to make informed decisions that support their bottom line.