The term also refers to an accounting system that tracks this information. See Cash basis . For example, an aged receivables report sorts invoices according to the date when payment is due. Information captured by the accounting system that allows you to reconstruct how a transaction affected each account balance, who performed the processing, and so on. An accounting method that reflects only cash activity.
Revenue is recorded when cash is received, and expenses are recorded when cash is disbursed.
This is contrasted with accrual basis . A notice that an account balance between two parties has been adjusted up or down. If a customer returns merchandise, for example, the vendor issues a credit memo. The IRS form filed quarterly to report income tax, FICA, and Medicare withholdings. The master record of a company's account balances, used to prepare financial statements and management reports.