Reports, (the heart of darkness)

[Mike or Penny Novack]

On 12/7/2016 4:51 PM, John Whitmore wrote:
> OK Now I think I have a sensible question. I'm looking at the "Income 
> Statement" report which looked good, but I've found a problem. Once I 
> file an Invoice in GnuCash it shows up as "Income" I'd have said that 
> it's only "Income" when the invoice is actually paid. That's 
> distorting my income as it looks like I've got money I don't actually 
> have as yet. Is this the way it would be expected to work? I'm not an 
> accountant so I could have the wrong impression of things.

This is the fundamental difference between "cash basis" and "accrual basis"

On which basis are you filing taxes? Many businesses are required to use 
accrual. Many individuals normally use cash (and some businesses). What 
are the rules of YOUR jurisdiction? How have you been filing? There may 
be additional complications if switching from one to the other. You 
almost certainly want to be keeping your books on the same basis as you 
file. Otherwise going to be complex adjustment entries at the end of the 
period, which if as you say, not experienced in accounting, you don;t 
want to have to tackle.

Michael D Novack