Allowable accrued expenses

zephyr
zephyr Registered Posts: 24 New contributor ?
I would be grateful on anyones thought re what is required for an expense to be accrued:

For example, my clients year end 31 Jan have placed an order for the car park to be re tarmaced. The order is in writing, I am unsure of the start date for the work.

The client has asked I accrue for this work in the current years accounts.

Is a written order enough? Or do you think the work must have started?

Many thanks

Comments

  • coojee
    coojee Registered Posts: 794
    Accruals are all about matching. If the work has been done then the payment must be matched to the work in the same accounting period ie an accrual made. Since the work hasn't been done then you mustn't accrue for it.
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