Accounting Accrual Method is an accounting treatment which involves recognizing revenue and expenses when they are incurred, regardless of the timing and receipt of payments. The core principle underlying accrual method is that businesses should recognize revenue when it is earned and expenses when they are incurred, rather than when payment is received or made. This treatment allows for a more accurate picture of a business’ financial performance and position over time. By using this language, accountants can better communicate the company’s financial results, helping to maximize transparency and ensure proper compliance with regulatory standards.