accrual
Accrual (noun) means an amount of income or expense that has been earned or incurred but not yet received or paid, recorded in the accounts for the period it belongs to. Example: “The auditors questioned a large accrual for legal fees at the year end.”
How to Use Accrual
Learner’s notesIn plain EnglishMoney or time that is building up before it is actually paid or taken.
Formal. Standard in accounting, payroll and finance.
Think 'grow' — the Latin root crescere is the same one in crescent and increase.
Trace the full origin ↓Fill the Gap
Can you complete this real example?
The auditors questioned a large _____ for legal fees at the year end.
Etymology
From accrue, from Old French acreue 'increase', from Latin accrescere 'to grow towards', from ad- + crescere 'to grow'.
Synonyms
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Rhymes for accrual
See all rhymes for accrual →Frequently Asked Questions
What is the difference between accrual and cash accounting?
Accrual accounting records income and costs when they are earned or incurred, whatever date the money moves. Cash accounting records them only when cash actually comes in or goes out. Accrual gives a truer picture of a period's performance, which is why it is required for most larger companies.
What is the difference between an accrual and a prepayment?
An accrual is for something you have received but not yet paid for, so it is a liability. A prepayment is for something you have paid for but not yet received, so it is an asset. They are mirror images of the same timing problem.
What does holiday accrual mean?
It means paid leave builds up gradually as you work, usually a fixed fraction of a day for each month or hour completed, rather than being granted all at once at the start of the year.