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accruals
/əˈkruːəlz/
accumulated amounts
The company recorded $50,000 in accruals for unpaid utilities.
The company noted $50,000 as amounts owed but not yet paid.
Finance
formal
Amounts of money or benefits that have been earned or incurred but not yet received or paid.
Accruals for employee bonuses were calculated at year-end.
Year-end calculations included bonuses owed to employees.
Interest accruals on the loan increased monthly.
The loan's interest grew each month as it accumulated.
Accruals follow the accrual basis of accounting, where revenue/expenses are recorded when earned/incurred, not when cash changes hands.
formal
The process of recording such accumulated amounts in financial statements.
The accounting team completed the accruals for Q3 taxes.
The team finalized the entries for taxes owed in Q3.
Often paired with 'accrual accounting' to distinguish from cash-basis accounting.
Collocations
accrual basisaccounting method recording transactions when they occuraccrual accountingfinancial recording system tracking earned revenue and incurred expensesaccrued expensescosts incurred but not yet paidaccrued revenueincome earned but not yet received
Antonyms
Related Phrases
Pro Tip
Remember the 'earned or incurred' rule
Accruals always refer to amounts that exist but aren't yet paid/received. Ask: 'Has the work been done or the expense occurred?' If yes, it's likely an accrual.
Gold Rule
Accruals vs. prepayments
Accruals are amounts owed (revenue earned/expenses incurred). Prepayments are amounts paid in advance (e.g., prepaid rent).
Word Origin
From Latin 'accrescere' (to grow to), via Old French 'accreistre' and Middle English 'accreuen'. The accounting sense emerged in the 19th century with the rise of double-entry bookkeeping.
Usage Notes
Plural form 'accruals' is standard in accounting contexts. Avoid using for non-financial growth (e.g., not for plant growth).
Word Breakdown
accru-
to grow/increase
root-als
plural noun suffix indicating things
suffixEnglish Dictionary