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cash basis accounting

   Also found in: Wikipedia 0.04 sec.
cash basis accounting
A method of accounting in which the receipt and payment of cash are the basis for recording transactions. Thus it is not the date on which goods and services are received that matters, as in accrual accounting, but the dates on which the cash changes hands for the transactions. Cash basis accounting is typically used for tax purposes by individuals but not by corporations. Compare accrual accounting.

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Also, conventional wisdom tells us that accrual basis accounting is vastly superior to cash basis accounting.
The restated financial statements using cash basis accounting will be more volatile demonstrating income and loss swings dependent upon the timing of the receipt of cash payments.
Financial Management: New features allow users to quickly respond to organizational changes, streamline balancing and reconciliation with enhanced reporting capabilities, simplify management of fixed assets, and leverage enhancements to the cash basis accounting functionality.
 
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