Cash Basis Accounts Receivable is a bookkeeping term used to refer to the accounting of receivables on a cash basis. This approach records revenue when it is received rather than when it is invoiced, and usually applies to small businesses or those that operate on a cash-only basis. In this system, profit and losses are not reported until the actual cash is exchanged. It also means that uncollectible debts often end up being recorded as expenses, which can lead to volatile income statements. Using cash basis Accounts Receivable is a simple way of tracking income and expenses, but can leave businesses vulnerable if they don’t collect payment in full.