"Comparative Study On Accounting Models ""cash"" And ""accrual"" "

Abstract

Accounting, as a source of information, can recognize the economic transactions taking into account the time of payment or receipt thereof, as soon as they occur. There are two basic models of accounting: accrual basis and cash basis. In the cash accounting method the transactions are recorded only when cash is received or paid, shall not make the difference between the purchase of an asset and the payment of expenditure-both of which are considered "payments". Accrual accounting achieves this distinction, as recognized accounting transactions as soon as they occur. At the same time, accrual accounting method ensure accurate submission of transactions, but in order to determine cash flow is necessary to apply cash accounting method. In the cash basis, revenues and expenses are reported in the period in which the payment is made or the income is received, whereas, and on the basis of accrual-based accounting method, income is expressing the effect achieved with the effort called expenses. In order to research the opportunities of information provided by the two accounting models in this study-by applying a methodology of research subscribed to the constructivist current and based on a vast practical experiences in accounting activities that apply both models of accounting-we achieved a SWOT analysis with exposing the strengths and weaknesses of the two accounting models highlighting the convergence and divergence between them.

Companies’ behavior in measuring the quality of financial reports: Pre- and post-pandemic research

“…-Accrual methods: (Bajra, 2018;Hoang, 2021). Being the most commonly used method, accruals methods are often linked with "accrual accounting, " which mandates the recognition of revenue at the time it is earned and expenses at the time they are incurred (Dȃnescu and Luminiţa, 2013). -Methods that focus on the study of specific elements of annual reports: (Željana and Mario, 2021).…”

“…This is because financial reporting has been and continues to be a primary means of communicating the results of transactions and events that occurred within an entity to various users ( Mbobo and Ekpo, 2016 ). Also, part of the research approach is directed toward the study of the social and psychological side of accounting, although there is no widely accepted definition of behavioral accounting ( Dănescu and Luminiţa, 2013 ).…”

The Effect of Using Accounting Measurement Bases (Cash and Accrual) on the Performance of the Industrial Companies Listed on Palestine Stock Exchange

“…Accrual basis is defined as that accounting basis that recognizes commercial transactions when they occur regardless of when cash is received or paid (Khan and Mayes, 2009). From this standpoint, the accrual basis provides information about the current and future cash for the activities of the various companies, so that the accounting recognition of revenues is in accordance with the laws in force that adopt the accrual basis (Danescu & Rus, 2013).…”