Accrual basis for accounting is a method of bookkeeping where income and expenses are recorded when they are incurred, rather than when payment is received or made. Instead of using cash flow as the standard for tracking financial activities, accrual basis accounts focus on when revenues are earned and when expenses are incurred. This allows for more accurate and comprehensive financial statements by ensuring that all transactions (regardless of timing of payments) are represented in your books. Ultimately, this helps provide visibility into your business’s financial performance over time.