[GNC] How to enter an accrued expense before Invoice?

[Wesley Brooks]

I think I've cracked it. Thanks to Adrien and David for the pointers.

I have created an Accrued Expenses account in:

Liabilities:Accrued Expenses

At the final day of my current accounting period I create a transfer 
which adds money to this account as such:

Actions > Transfer

Within the pop up:

  * Set date to final day of accounting period.
  * Description: Accrued expense for accounting period 221101-231031
  * Amount: Expected accountant fee.
  * Transfer From: Liabilities:Accrued Expenses
  * Transfer To: Expenses:Professional Fees:Accounting

When the invoice from the accountant is received I return the funds from 
the accrued accounts:

Actions > Transfer

Within the pop up:

  * Set date to that of invoice.
  * Description: Transfer from Accrued expenses for accounting period
    221101-231031
  * Amount: Previously expected accountant fee.
  * Transfer From: Expenses:Professional Fees:Accounting
  * Transfer To: Liabilities:Accrued Expenses

So in summary from how I now understand this GNUCash doesn't have any 
method of linking the accrued expense to the invoice, it just has to be 
processed manually.

Thanks!


On 14/05/2024 22:14, Adrien Monteleone wrote:
> This is essentially a basic accounting question, not so much 'how to 
> do this in GnuCash.'
>
> The exact accounts used are up to you, but generically between an 
> accounts such as:
>
> Dr. Expenses:Professional Services
>   Cr. Liabilities:Accrued Expenses
>
> When the invoice is received, draw down the Accrued Expenses account 
> to an Accounts Payable account:
>
> Dr. Liabilities:Accrued Expenses
>   Cr. Liabilities:Accounts Payable
>
> (when you pay the invoice, you'll draw down the Accounts Payable 
> account to whatever Asset account you used as a source of funds, e.g., 
> Assets:Checking, as with any other Vendor Bill)
>
> In the case of using the GnuCash features, you can enter the accrued 
> expense manually or via an SX. (Scheduled Transaction)
>
> Then when the accountant's invoice is received, enter a Vendor Bill in 
> GnuCash with the line items posting to the relevant Accrued Expenses 
> account, and posting the entire Bill to the relevant Accounts Payable 
> account.
>
> The date of booking the Accrued Expense should be when the expense was 
> incurred, thus, when you received service from the accountant.
>
> The date of the Bill should be the date of the accountant's invoice.
>
> The date of the payment is the date you effectively paid it. (usually 
> the 'tender' date, such as post-marking if sent by snail mail) There 
> are also 'received' and 'cleared' dates in some cases, but those are 
> not always relevant to when a debt was considered 'paid' but that will 
> depend on your specific jurisdicition and circumstances. (those may be 
> relevant to reconciling your bank/credit account however, if it 
> factors in.)
>
> As always, this isn't accounting advice - ask your accountant!
>
>
> Regards,
> Adrien
>
> On 5/14/24 8:39 AM, Wesley Brooks wrote:
>> I'm a basic level user of GNUCash, and generally enter transaction 
>> details mostly by raising bills/invoices and subsequently processing 
>> the payments. The only exceptions to this are how I enter my salary 
>> payments, and transfers between my company and private accounts 
>> covering director loans and repayments.
>>
>> My accountant has added their charge for accounting and an accrued 
>> expense on their submissions, long before they would raise an invoice.
>>
>> How do I generate an accrued expense so that it works with a 
>> subsequently raised the invoice, and processed payment in the 
>> following year?
>
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Wesley Brooks PhD BEng

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