{"id":871,"date":"2018-11-06T20:40:51","date_gmt":"2018-11-06T20:40:51","guid":{"rendered":"http:\/\/www.clubtreasurer.com\/blog\/?page_id=871"},"modified":"2026-07-02T18:01:15","modified_gmt":"2026-07-02T17:01:15","slug":"advanced-accounting-accruals-and-prepayments","status":"publish","type":"page","link":"https:\/\/clubtreasurer.com\/blog\/advanced-accounting-accruals-and-prepayments\/","title":{"rendered":"Accruals and Prepayments"},"content":{"rendered":"\n<h3 class=\"wp-block-heading\">Cash Accounting vs. Accruals Accounting<\/h3>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>Clubtreasurer<\/strong> uses a modified <strong>cash accounting<\/strong> system by default, which suits the needs of most small clubs and community organisations.<\/p>\n\n\n\n<hr class=\"wp-block-separator has-alpha-channel-opacity\"\/>\n\n\n\n<h4 class=\"wp-block-heading\">What is Cash Accounting?<\/h4>\n\n\n\n<p class=\"wp-block-paragraph\" style=\"padding-top:0;padding-right:0;padding-bottom:0;padding-left:0;font-style:normal;font-weight:100\">With cash accounting, you only record income or expenses when money is actually received or paid out. For most clubs, simply using <strong>Receipts<\/strong> and <strong>Payments<\/strong> to track money moving in and out is all that\u2019s needed.<\/p>\n\n\n\n<hr class=\"wp-block-separator has-alpha-channel-opacity\"\/>\n\n\n\n<h4 class=\"wp-block-heading\">What is Accruals Accounting?<\/h4>\n\n\n\n<p class=\"wp-block-paragraph\">Some organisations prefer to use <strong>accruals accounting<\/strong> to get a more accurate picture of their financial position by matching income and expenses to the period they relate to, rather than when the cash is exchanged. <\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Prepayments<\/strong> = Money paid or received in advance, for goods or services that relate to a future period.<\/li>\n\n\n\n<li><strong>Accruals<\/strong> = Money owed or due (costs or income that have occurred but not yet paid or received).<\/li>\n<\/ul>\n\n\n\n<p class=\"wp-block-paragraph\"><em>Please note that even cash-based organisations may require simple accruals accounting at their year-end to correctly account for monies received for next year&#8217;s income, or payments due now but not paid until next year. <\/em><\/p>\n\n\n\n<div class=\"wp-block-group has-nv-light-bg-background-color has-background\"><div class=\"wp-block-group__inner-container is-layout-constrained wp-block-group-is-layout-constrained\">\n<h4 class=\"wp-block-heading\">Example:<\/h4>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Club A receives new kit on <strong>1st January<\/strong> but pays the supplier on <strong>5th February<\/strong>.\n<ul class=\"wp-block-list\">\n<li><strong>Cash Accounting:<\/strong> Records the payment in February (when cash leaves the bank).<\/li>\n\n\n\n<li><strong>Accruals Accounting:<\/strong> Records the cost in <em>January<\/em> (when the kit is used), and shows the payment in <em>February<\/em> as a reduction in the outstanding liability.<br><\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<\/div><\/div>\n\n\n\n<hr class=\"wp-block-separator has-alpha-channel-opacity\"\/>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Recording Accruals &amp; Prepayments in Clubtreasurer<\/strong><\/h3>\n\n\n\n<p class=\"wp-block-paragraph\">Clubtreasurer supports both simple and advanced methods for tracking accruals and prepayments.<\/p>\n\n\n\n<h5 class=\"wp-block-heading\">Which method is right for you?<\/h5>\n\n\n\n<p class=\"has-nv-light-bg-background-color has-background wp-block-paragraph\"><strong>Simple Method (Recommended for most)<\/strong><br>Best if your organisation primarily uses cash-based accounting but needs to make <strong>occasional<\/strong> adjustments\u2014such as adjusting for a large annual insurance bill at year-end.<\/p>\n\n\n\n<p class=\"has-very-light-gray-to-cyan-bluish-gray-gradient-background has-background wp-block-paragraph\"><strong>Advanced Method<\/strong><br>Designed for larger or more complex organisations that operate on a <strong>full-time accrual accounting<\/strong> basis, where every monthly income and expense must be precisely matched to the period it belongs to.<\/p>\n\n\n\n<ul class=\"wp-block-list has-medium-font-size\">\n<li><a href=\"https:\/\/clubtreasurer.com\/blog\/simple-accruals-prepayments\/\" type=\"page\" id=\"3959\"><strong>Simple Accruals and Prepayments<\/strong><\/a><\/li>\n\n\n\n<li><a href=\"https:\/\/clubtreasurer.com\/blog\/advanced-accruals-prepayments\/\" type=\"page\" id=\"3961\"><strong>Advanced Accruals and Prepayments<\/strong><\/a><\/li>\n<\/ul>\n\n\n\n<div style=\"height:59px\" aria-hidden=\"true\" class=\"wp-block-spacer\"><\/div>\n\n\n\n<hr class=\"wp-block-separator has-alpha-channel-opacity\"\/>\n\n\n\n<h3 class=\"wp-block-heading\">Other Accruals Topics<\/h3>\n\n\n\n<ul class=\"wp-block-list has-medium-font-size\">\n<li class=\"has-small-font-size\"><a href=\"https:\/\/clubtreasurer.com\/blog\/accruals-and-prepayments-accounting-for-funds-held-on-behalf-of-members-for-3rd-party-purchases\/\" type=\"page\" id=\"3974\">Accounting for accrued funds held on behalf of Members for 3rd-Party Purchases<\/a><\/li>\n<\/ul>\n\n\n\n<p class=\"wp-block-paragraph\"><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Cash Accounting vs. Accruals Accounting Clubtreasurer uses a modified cash accounting system by default, which suits the needs of most small clubs and community organisations. What is Cash Accounting? With cash accounting, you only record income or expenses when money is actually received or paid out. For most clubs, simply using Receipts and Payments to&hellip;&nbsp;<a href=\"https:\/\/clubtreasurer.com\/blog\/advanced-accounting-accruals-and-prepayments\/\" rel=\"bookmark\">Read More &raquo;<span class=\"screen-reader-text\">Accruals and Prepayments<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"parent":0,"menu_order":0,"comment_status":"closed","ping_status":"closed","template":"","meta":{"neve_meta_sidebar":"","neve_meta_container":"","neve_meta_enable_content_width":"","neve_meta_content_width":0,"neve_meta_title_alignment":"","neve_meta_author_avatar":"","neve_post_elements_order":"","neve_meta_disable_header":"","neve_meta_disable_footer":"","neve_meta_disable_title":"","footnotes":""},"class_list":["post-871","page","type-page","status-publish","hentry"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v28.0 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Accruals and Prepayments - Clubtreasurer Community<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/clubtreasurer.com\/blog\/advanced-accounting-accruals-and-prepayments\/\" \/>\n<meta property=\"og:locale\" content=\"en_GB\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Accruals and Prepayments - Clubtreasurer Community\" \/>\n<meta property=\"og:description\" content=\"Cash Accounting vs. Accruals Accounting Clubtreasurer uses a modified cash accounting system by default, which suits the needs of most small clubs and community organisations. 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