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I guess this is a fundamental different between accrual vs cash accounting. In accrual accounting, you would book the revenue when the service is provided and d
by Scoundreller 3y ago
I guess this is a fundamental different between accrual vs cash accounting. In accrual accounting, you would book the revenue when the service is provided and delaying/advancing a payment shouldn’t change the fiscal year it falls under.
In Canada, most of the time you’re required to follow accrual accounting.
I guess if you have the choice and expect routine delays to payments, cash accounting is the way to go.
- borissk 3y agoAnd what if you do the work and never get payed? Sounds stupid to pay taxes over income one hasn't actually received.
- Scoundreller 3y agoYou have allowances for doubtful accounts and/or bad debts. Also sounds stupid to game taxes by delaying/advancing payments.