Accrual method accounting is a type of bookkeeping that records revenue and expenses when they are incurred, rather than at the time when cash payments are received or made. When using this method, businesses recognize their profits and losses in the period they happen, as opposed to when they were received or paid. For example, if your business makes a sale in April and delivers the goods on credit later in June, you would record the sale in April, even though the cash won’t actually be collected until June. This method provides a more reliable snapshot of business performance over time and reduces volatility in your financial reports. It’s important to speak with an accountant or bookkeeper who understands the complexities of accrual method accounting and can provide the right advice for your business.