On 2024-04-09 01:19, David Carlson wrote: > Nearly every time [the bank's] list doesn't match my list, the > difference is precisely the difference between when I wrote the check or > when I initiated a payment online or when I swiped a card and when they > posted the transaction to my account. That is what we users often consider > to be the difference between accrual basis vs cash basis.
I must respectfully disagree. That difference is simply timing. It can occur whether you are on a cash basis or an accrual basis, but in itself it is not a difference between cash and accrual basis. The chief difference between cash basis and accrual basis, for a person as opposed to a business, is whether you record money you owe but haven't paid (liabilities) and money owed to you but not yet received (assets). For example, suppose you have a credit card, and to avoid paying finance charge you chose to have your bank automatically pay the latest statement balance on the payment due date. How is a restaurant dinner recorded when you pay by credit card? On cash basis, it's not an expense until it's paid. Therefore, _nothing_ is recorded until the payment date after the statement date after the meal. Then you record Dr: Expenses:Restaurant Dining Cr: Assets:Cash in Bank and a similar entry for every charge on that month's credit card statement. On accrual basis, it's an expense when it's incurred. You make this entry when the meal happens: Dr: Expenses:Restaurant Dining Cr: Liabilities:Credit Card and then when the payment happens, you make _one_ final entry: Dr: Liabilities:Credit Card Cr: Assets:Cash in Bank Since the payment is automatic, you and the bank will record it as of the same date, whether you are on the cash basis or accrual basis. Stan Brown Tehachapi, CA, USA https://BrownMath.com _______________________________________________ gnucash-user mailing list gnucash-user@gnucash.org To update your subscription preferences or to unsubscribe: https://lists.gnucash.org/mailman/listinfo/gnucash-user ----- Please remember to CC this list on all your replies. You can do this by using Reply-To-List or Reply-All.