The Accrual Basis Method is a way of accounting for a business’ financial transactions. It indicates when revenue and expenses are earned or incurred, rather than when the payment for those transactions is actually received or made. Under this method, revenue is recorded when it’s earned – not when it’s received or collected, and expenses are recorded when they’re incurred – not when they’re paid. This way of accounting offers valuable insights into a business’ financial health by providing an accurate view of its current position, as well as a more accurate picture of its future performance.