Cash Accounting. In its simplest form, cash accounting is a system in which a company records expenses and revenues as the money changes hands.  When your client hands you cash, it is reported in your books. Likewise, when you pay a vendor, the expense is realized. Note that cash accounting has many names, so you may have heard it called cash-basis accounting, the cash method of accounting, or the cash receipts and disbursements method of accounting, among others. If you remember our discussion of Bookkeeping for your SaaS Business, accounting is split into two categories: the cash accounting we discuss here and the more complicated, but also more accurate, accrual accounting.  Unlike cash accounting, accrual accounting recognizes revenues and expenses as they are posted using accounts receivable and accounts payable journal entries. The table below gives you a quick and easy reference for the differences: There are many benefits to cash accounting, most of which are especially true for new and/or small businesses: 
[INST] Cash Accounting [/INST]
 In its simplest form, cash accounting is a system in which a company records expenses and revenues as the money changes hands.  When your client hands you cash, it is reported in your books. Likewise, when you pay a vendor, the expense is realized. Note that cash accounting has many names, so you may have heard it called cash-basis accounting, the cash method of accounting, or the cash receipts and disbursements method of accounting, among others. If you remember our discussion of Bookkeeping for your SaaS Business, accounting is split into two categories: the cash accounting we discuss here and the more complicated, but also more accurate, accrual accounting.  Unlike cash accounting, accrual accounting recognizes revenues and expenses as they are posted using accounts receivable and accounts payable journal entries. The table below gives you a quick and easy reference for the differences: There are many benefits to cash accounting, most of which are especially true for new and/or small businesses: 
<sys> [INST] Cash Accounting [/INST] In its simplest form, cash accounting is a system in which a company records expenses and revenues as the money changes hands.  When your client hands you cash, it is reported in your books. Likewise, when you pay a vendor, the expense is realized. Note that cash accounting has many names, so you may have heard it called cash-basis accounting, the cash method of accounting, or the cash receipts and disbursements method of accounting, among others. If you remember our discussion of Bookkeeping for your SaaS Business, accounting is split into two categories: the cash accounting we discuss here and the more complicated, but also more accurate, accrual accounting.  Unlike cash accounting, accrual accounting recognizes revenues and expenses as they are posted using accounts receivable and accounts payable journal entries. The table below gives you a quick and easy reference for the differences: There are many benefits to cash accounting, most of which are especially true for new and/or small businesses:  </sys