The primary goal of the accrual basis of accounting is to match revenues and expenses in the proper period. This means recognizing revenue when it is earned and expenses when they are incurred, regardless of when the cash is actually received or paid. This matching principle provides a more accurate representation of a company's financial position and performance for a given period, allowing for better insight into profitability and financial health
. By recording transactions at the time they occur rather than when cash changes hands, accrual accounting offers a clearer and more realistic picture of a business’s financial condition, including its assets and liabilities. This approach aligns with Generally Accepted Accounting Principles (GAAP) and is required for most companies, especially those with significant revenues or inventory
