Do any of your good selves ever set a limit on your accruals, for example, I have a courier company that may bill me on the first of August, my year ends at the end of July, the bill would be for deliveries in the last week of July and it may amount to say £50, would it be worth accruing?
Not sure that there is a definitive answer to this, the purist would possibly accrue for everything, I guess I'm a likely to take a more 'broad brushed' approach and look at materiality, does not accruing this alter the bigger picture? The line will be drawn differently on every organisation but I think even the smallest business will not be affected materially on 50 quid. Having said that since you have identified what the accrual is maybe you may as well enter the journal anyway!
First it was "there, or there abouts", now it's "broad brushed"!
Shaun must be banging his head on a desk somewhere, saying "no, no, no"
I tend to accrue everything but that's just me. I would agree with Rob, is it material? I would also add, is it consistent treatment? was it accrued last year?
I would talk more but my head hurts and on top of that I'm now stressed by this Rob induced dent in my desk.
lol.
I don't see the big issue with acruels. Enter everything at the right date and they look after themselves. But then, like yourself, I enter everything as an Accrual in the first place so as a rule no need to mess around with journals.
laters fellow amigo's.
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Shaun
Responses are not meant as a substitute for professional advice. Answers are intended as outline only the advice of a qualified professional with access to all relevant information should be sought before acting on any response given.
Thanks Rob, I will be accruing this and another courier invoice because they can amount to a considerable amount, and as you say I have identified them so I may as well. I'm looking at maybe moving toward a "broad brushed" approach dependent on the outcome of this year end
Thanks Bill, even though they haven't been accrued before I will this time as it's my first time and we have increased online sales considerably over the past year. The accountant has always done all the accruals and "un-expired costs" (never heard of that one before but seems to make sense) however I'm pretty sure he just looks at the same thing year after year, I'm hoping to make everything much clearer this year, and you never know, if I can score enough brownie points perhaps I may finally make the jump and do a bit of self employed work if he can provide any
Thanks Shaun, I'm not as yet allowed to post accruals and pre-payments, so I'm hoping this year he will see that I can do them after all, then maybe as said above I can grovel for some scraps of work
