Choose cash or accrual accounting
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This guide explains the accounting-basis setting and how it changes the timing of income and expense recognition.
What you’ll accomplish
Understand the accounting-basis setting and how it changes the timing of income and expense recognition. It forms part of Pixie CRM Enterprise CRM's Accounting & Bookkeeping module and uses the module's permission-aware controller, status and mapping flow rather than a generic spreadsheet process.
How it works
The setting affects how the module presents financial activity; it does not replace source-document status controls. An unpaid customer invoice still exists operationally even when a cash-basis report does not yet recognise the income in the same way.
Accrual reporting depends heavily on correctly converted invoices, bills, credit notes and expenses. Cash reporting depends on correctly converted payments and cash movements.
Use Trial Balance and detailed transaction reports to explain unexpected differences.
Follow these steps
- Verify the basis required by the organisation's accountant and reporting obligations.
- Go to General Accounting settings.
- Select the approved accounting method.
- Save the setting.
- Run a controlled Profit & Loss report for a period containing unpaid and paid records.
- Verify the result with finance before using the basis for management reporting.
Settings to check
Check it worked
After the action is saved, Pixie CRM keeps the Accounting record connected to its source and updates the visible status or ledger data supported by this workflow. Review the saved result rather than relying only on a success message. Where the action posts accounting data, total debits and credits must balance and the accounts must match the approved mapping or manual selection.
- Open the saved record and confirm its final status.
- Review the source reference and every debit and credit line where ledger data was created.
- Use the relevant register, ageing, reconciliation or report to verify the wider effect.
Common mistakes to avoid
- Do not switch basis casually between reporting periods.
- A cash-basis view does not remove receivable or payable operational records.
- Keep invoice and payment dates accurate.
- Document the effective date of a policy change.
- Use the least destructive correction available and record the reason for material changes.
- Do not bypass a permission, approval or closed-period control by changing unrelated data.