{"id":10944,"date":"2018-07-16T13:41:22","date_gmt":"2018-07-16T17:41:22","guid":{"rendered":"https:\/\/foundationsoft.com\/?p=10944"},"modified":"2025-05-05T09:15:06","modified_gmt":"2025-05-05T13:15:06","slug":"cash-vs-accrual-accounting","status":"publish","type":"post","link":"https:\/\/www.foundationsoft.com\/learn\/cash-vs-accrual-accounting\/","title":{"rendered":"Cash vs. Accrual Accounting: The Difference for Your Construction Business"},"content":{"rendered":"\n<div class=\"wp-block-presto-player-reusable-edit\"><!--presto-player:video_id=26--><figure class=\"wp-block-video presto-block-video  presto-provider-youtube\" style=\"--plyr-color-main: var(--presto-player-highlight-color, #f8c01b); --presto-player-logo-width: 150px; \">\n\t<presto-player \n\t\tpreset='{&quot;id&quot;:1,&quot;name&quot;:&quot;Default&quot;,&quot;slug&quot;:&quot;default&quot;,&quot;icon&quot;:&quot;format-video&quot;,&quot;skin&quot;:&quot;modern&quot;,&quot;play-large&quot;:true,&quot;rewind&quot;:true,&quot;play&quot;:true,&quot;fast-forward&quot;:true,&quot;progress&quot;:true,&quot;current-time&quot;:true,&quot;mute&quot;:true,&quot;volume&quot;:true,&quot;speed&quot;:false,&quot;pip&quot;:false,&quot;fullscreen&quot;:true,&quot;captions&quot;:false,&quot;reset_on_end&quot;:true,&quot;auto_hide&quot;:true,&quot;captions_enabled&quot;:false,&quot;save_player_position&quot;:true,&quot;sticky_scroll&quot;:false,&quot;sticky_scroll_position&quot;:&quot;bottom right&quot;,&quot;on_video_end&quot;:&quot;select&quot;,&quot;play_video_viewport&quot;:false,&quot;hide_youtube&quot;:false,&quot;lazy_load_youtube&quot;:false,&quot;hide_logo&quot;:false,&quot;border_radius&quot;:0,&quot;caption_style&quot;:&quot;&quot;,&quot;caption_background&quot;:&quot;&quot;,&quot;is_locked&quot;:true,&quot;cta&quot;:[&quot;&quot;],&quot;watermark&quot;:[&quot;&quot;],&quot;search&quot;:[&quot;&quot;],&quot;email_collection&quot;:[&quot;&quot;],&quot;action_bar&quot;:[&quot;&quot;],&quot;created_by&quot;:49,&quot;created_at&quot;:&quot;2023-11-22 06:36:48&quot;,&quot;updated_at&quot;:&quot;2023-11-22 06:36:48&quot;,&quot;deleted_at&quot;:&quot;&quot;,&quot;show_time_elapsed&quot;:false}'\n\t\tbranding='{&quot;logo&quot;:&quot;&quot;,&quot;color&quot;:&quot;#f8c01b&quot;,&quot;logo_width&quot;:150,&quot;player_css&quot;:&quot;&quot;}'\n\t\tchapters='[]'\n\t\toverlays='[]'\n\t\ttracks='[]'\n\t\tblock-attributes='{&quot;playsInline&quot;:true,&quot;id&quot;:26,&quot;src&quot;:&quot;https:\\\/\\\/www.youtube.com\\\/embed\\\/jIJQ1JGioXo?rel=0&quot;,&quot;preset&quot;:1,&quot;video_id&quot;:&quot;jIJQ1JGioXo&quot;,&quot;visibility&quot;:&quot;public&quot;,&quot;color&quot;:&quot;#00b3ff&quot;,&quot;mutedPreview&quot;:{&quot;enabled&quot;:false,&quot;captions&quot;:false},&quot;mutedOverlay&quot;:{&quot;enabled&quot;:false,&quot;src&quot;:&quot;&quot;,&quot;width&quot;:200,&quot;focalPoint&quot;:{&quot;x&quot;:0.5,&quot;y&quot;:0.5}},&quot;mutedOverlayType&quot;:&quot;text&quot;,&quot;mutedOverlayText&quot;:&quot;Click to play&quot;,&quot;mutedOverlayImageWidth&quot;:200,&quot;chapters&quot;:[],&quot;overlays&quot;:[],&quot;tracks&quot;:[],&quot;openPopupId&quot;:&quot;&quot;,&quot;title&quot;:&quot;Cash vs. Accrual Accounting in Construction&quot;}'\n\t\tanalytics=''\n\t\tautomations\t\tprovider='youtube'\n\t\t\t\tid=\"presto-player-1\"\n\t\tsrc=\"\/\/www.youtube.com\/embed\/jIJQ1JGioXo?iv_load_policy=3&amp;modestbranding=1&amp;playinline=1&amp;showinfo=0&amp;rel=0&amp;enablejsapi=1\"\n\t\tmedia-title=\"Cash vs. Accrual Accounting in Construction\"\n\t\tcss=\"\"\n\t\tclass=\"presto-video-id-26 presto-preset-id-1 skin-modern\"\n\t\tskin=\"modern\" \n\t\ticon-url=\"https:\/\/www.foundationsoft.com\/wp-content\/plugins\/presto-player\/img\/sprite.svg\" \n\t\tpreload=\"\" \n\t\tposter=\"\"\n\t\tyoutube=\"{&quot;noCookie&quot;:false,&quot;channelId&quot;:&quot;&quot;,&quot;show_count&quot;:false}\"\n\t\tprovider-video-id=\"jIJQ1JGioXo\"\n\t\tvideo-id=\"26\"\n\t\t\t\tplaysinline \n\t\t\t\t>\n\t\t\n    <div class=\"presto-iframe-fallback-container\">\n        <iframe style=\"width: 100%\" title=\"Youtube Video\" class=\"presto-fallback-iframe\" id=\"presto-iframe-fallback-1\" data-src=\"https:\/\/www.youtube.com\/embed\/jIJQ1JGioXo?iv_load_policy=3&amp;modestbranding=1&amp;playsinline=1&amp;showinfo=0&amp;rel=0&amp;enablejsapi=1\" allowfullscreen allowtransparency allow=\"autoplay\"><\/iframe>\n    <\/div>\n\n\t<\/presto-player>\n<\/figure><\/div>\n\n<div class=\"clear\"><\/div>\n<div class=\"gdlr-space\" style=\"margin-top: 20px;\"><\/div>\n<p>A successful, sustainable construction business is ultimately about <a href=\"https:\/\/www.foundationsoft.com\/learn\/sides-cash-flow-reporting\/\">cash management<\/a>. The problem is that <a href=\"https:\/\/www.pymnts.com\/smbs\/2024\/60-of-small-businesses-struggle-with-cash-flow-management\/\">60%<\/a> of small businesses suffer from ineffective cash flow management.<\/p>\n<p>Your company needs to know not just how much cash it has but when it has it, when it needs it and when to expect it. You also need to know how much tax agencies expect! That\u2019s what the idea of <em>revenue recognition <\/em>is concerned with. Contractors have options as far as <em>how<\/em> they want to recognize revenue \u2014 or, record income \u2014 both on their books and for tax purposes. The main choice is between \u201ccash accounting\u201d and \u201caccrual accounting.\u201d<\/p>\n<a target=\"_blank\" href=\"\/job-costing-ultimate-guide\/\" class=\"blog-cta-image\"><img decoding=\"async\" src=\"\/wp-content\/uploads\/2024\/03\/FSL-blog-post-ad-ultimate-guide.png\" alt=\"UG to Job Costing\" title=\"UG to Job Costing\"><\/a>\n<h2><span class=\"ez-toc-section\" id=\"Cash-Basis_Accounting\"><\/span>Cash-Basis Accounting<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>In cash accounting, everything is based on its real-time impact on your cash. That can be literal cash bills, but more often it\u2019s a bank account. Revenue is recorded when and only when you receive the money. Expenses are recognized when and only when you actually pay. That makes it the simplest method.<\/p>\n<p>You probably practice cash accounting if you manage your personal finances. When you check out at the hardware store, you pay at the register. If you use a $20 bill or a debit card, you know it affects your money today. But if you pull out a credit card, it won\u2019t impact your bank balance until you have to pay the Visa statement later.<\/p>\n<div class=\"gdlr-shortcode-wrapper\">\n<div class=\"gdlr-styled-box-item-ux gdlr-ux\" >\n<div class=\"gdlr-item gdlr-styled-box-item\" >\n<div class=\"gdlr-styled-box-head-wrapper\" >\n<div class=\"gdlr-styled-box-corner\" style=\"border-bottom-color:#999999;\" ><\/div>\n<div class=\"gdlr-styled-box-head\" style=\"background-color:#ababab;\" ><\/div>\n<\/div>\n<div class=\"gdlr-styled-box-body with-head\" style=\"background-color:#ababab; color: #ffffff; \" >\n<h3><span class=\"ez-toc-section\" id=\"Example_of_Cash_Accounting_in_Construction\"><\/span>Example of Cash Accounting in Construction<span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>In construction, the cash-basis approach is similar. Let\u2019s say Build-It Construction just finished framing. They bill their customer $8,000 due 30 days from the invoice date. Meanwhile, the contractor continues to record payroll costs every time they issue checks. Up to this point, under the cash method, they don\u2019t have any income from the work they did. Only after they receive payment the following month can they say they made money.<\/p>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<h2><span class=\"ez-toc-section\" id=\"Accrual_Accounting\"><\/span>Accrual Accounting<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>Accrual accounting records revenue as you <em>earn<\/em> it rather than when you <em>receive <\/em>it. Similarly, companies record expenses as soon as they have an obligation to pay, not when they actually pay. In construction, this usually happens with the invoicing process.<\/p>\n<p>The accrual method lets businesses note transactions before cash changes hands. It\u2019s a way of saying, \u201cAs of this date, we\u2019re banking on this revenue we earned,\u201d or, \u201cThis $500 cash is actually earmarked for a bill we owe.\u201d<\/p>\n<p>The money hasn\u2019t actually <em>gone <\/em>anywhere yet. Instead, these amounts <em>accrue <\/em>(or, add up over time) in special accounts that represent a kind of fictional or theoretical money, like an IOU, to be converted into real money. They\u2019re usually called <em>accounts receivable <\/em>(\u201cA\/R\u201d) and <em>accounts payable<\/em> (\u201cA\/P\u201d). Once cash does move, the business will record it as a new, separate transaction because it\u2019s seen as a new, separate event.<\/p>\n<div class=\"gdlr-shortcode-wrapper\">\n<div class=\"gdlr-styled-box-item-ux gdlr-ux\" >\n<div class=\"gdlr-item gdlr-styled-box-item\" >\n<div class=\"gdlr-styled-box-head-wrapper\" >\n<div class=\"gdlr-styled-box-corner\" style=\"border-bottom-color:#999999;\" ><\/div>\n<div class=\"gdlr-styled-box-head\" style=\"background-color:#ababab;\" ><\/div>\n<\/div>\n<div class=\"gdlr-styled-box-body with-head\" style=\"background-color:#ababab; color: #ffffff; \" >\n<h3><span class=\"ez-toc-section\" id=\"Example_of_Accrual_Basis_in_Construction\"><\/span>Example of Accrual Basis in Construction<span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>Let\u2019s look again at Build-It Construction. This time, when they finish framing and bill their customer, they record $8,000 of A\/R, because even though they haven\u2019t received this money, it\u2019s literally receive-<em>able<\/em>. This also allows them to record $8,000 of income. When the customer pays them the next month, they\u2019ll simply move the $8,000 from A\/R to their cash account.<\/p>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<h2><span class=\"ez-toc-section\" id=\"Choosing_Cash_or_Accrual_Accounting\"><\/span>Choosing Cash or Accrual Accounting<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<h3><span class=\"ez-toc-section\" id=\"Advantages_of_Cash_Accounting\"><\/span>Advantages of Cash Accounting (+)<span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>Because cash accounting is the simplest method, it\u2019s preferred by many small businesses. Contractors who operate on a cash basis won\u2019t necessarily need sophisticated software. They may also be able to get by without much accounting expertise, as long as they\u2019re still working with a construction CPA.<\/p>\n<p>Cash accounting can also offer contractors tax advantages. In construction, businesses often have at least a little control over exactly when cash enters or leaves the company. For example, Built-It Construction might ask their customers to hold payment on December invoices until January, or they can pay early on expenses that aren\u2019t due until January. As a result, they\u2019re effectively deferring income into the next year. Because they\u2019re not technically making that money in the current year, this lets them report a lower profit and pay lower taxes for now.<\/p>\n<blockquote class=\"gdlr-align-center\" ><p>In cash accounting, everything&#8217;s based on its real-time impact on your cash.<\/p><\/blockquote>\n<h3><span class=\"ez-toc-section\" id=\"Disadvantages_of_Cash_Accounting\"><\/span>Disadvantages of Cash Accounting (-)<span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>The cash method isn\u2019t without drawbacks, however. Construction has a long delay between (a) earning revenue from performance and billing and (b) receiving revenue from payment. That means financial statements aren\u2019t very useful because, in a way, they\u2019re not very accurate. Built-It Construction\u2019s balance sheet won\u2019t reflect any of the money they expect for the work they\u2019ve done. At the same time, their financials will show all of the materials and labor costs they\u2019ve racked up. This gives them a skewed picture of their profits.<\/p>\n<p>As a result, contractors might choose to use the cash method for tax purposes but use an accrual method for their own bookkeeping. In order to use cash-basis accounting for taxes, though, a contractor\u2019s average annual receipts <a href=\"https:\/\/www.irs.gov\/publications\/p538#en_US_201212_publink1000270640\" target=\"_blank\" rel=\"noopener\">can\u2019t exceed $5 million<\/a>. You\u2019ll need to make sure you\u2019re eligible before you start using it.<\/p>\n<h3><span class=\"ez-toc-section\" id=\"Advantages_of_Accrual_Accounting\"><\/span>Advantages of Accrual Accounting (+)<span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>Accrual-basis accounting will tend to provide a more accurate, helpful financial picture. Financial statements like the balance sheet and cash flow statement will show revenues and expenses earlier on so expected cash can at least be factored into analysis and decisions.<\/p>\n<p>While it may require a little more accounting knowledge to use, accrual accounting can give greater control over financial information. That can be especially valuable when a high volume of transactions needs to be tracked with 30, 60 or even 90 days between invoicing and receipts.<\/p>\n<blockquote class=\"gdlr-align-center\" ><p>Accrual accounting records revenue as it\u2019s <em>earned <\/em>rather than when it\u2019s <em>received<\/em>.<\/p><\/blockquote>\n<p>Finally, within accrual accounting, contractors actually have additional options of when accrued income is recognized, each with their own implications. In the <strong>percentage-of-completion method<\/strong>, contractors bill for and recognize revenue periodically based on what proportion of the contract they\u2019ve completed. Under the <strong>completed-contract method<\/strong>, neither revenue nor expenses on a job are recognized until the project is done.<\/p>\n<h3><span class=\"ez-toc-section\" id=\"Disadvantages_of_Accrual_Accounting\"><\/span>Disadvantages of Accrual Accounting (-)<span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>The downside of accrual basis is that a construction business can end up paying taxes on income they haven\u2019t actually received as cash yet. For example, as far as the IRS is concerned, Build-It Construction earned 18,000 taxable dollars, and the government expects its piece. In reality, Build-It Construction doesn\u2019t have that $18,000, but they might still have to shell out several thousand dollars because it&#8217;s on their books.<\/p>\n<p>Similarly, a contractor might want to bill most of their income as early as possible in order to build up their cash for the rest of the project. Over the course of the contract, expenses will balance out their front-heavy income. But if they need to report taxes before then, it\u2019ll look like they\u2019re making a much higher profit than they really are. They might end up having to pay taxes on this \u201cimaginary profit\u201d rather than the actual profit they\u2019ll take home on the contract.<\/p>\n<p>Lastly, because accrual-basis financial statements generally don\u2019t look at cash receipts, the income statement and balance sheet might not clearly reveal the company\u2019s cash position. But contractors who take the important step of <a href=\"\/learn\/construction-cash-flow-reporting\/\">putting together cash flow statements<\/a> will easily overcome this.<\/p>\n<table class=\"style-2\">\n<tbody>\n<tr>\n<th width=\"50%\">Cash Basis<\/th>\n<th>Accrual Basis<\/th>\n<\/tr>\n<tr>\n<td>\n<ul>\n<li style=\"text-align: left;\">Simple to use<\/li>\n<li style=\"text-align: left;\">Focuses on cash flow<\/li>\n<li style=\"text-align: left;\">Allows for tax deferrals<\/li>\n<\/ul>\n<\/td>\n<td>\n<ul>\n<li style=\"text-align: left;\">Produces accurate financial statements<\/li>\n<li style=\"text-align: left;\">Tracks pre-cash transactions<\/li>\n<li style=\"text-align: left;\">Required for mid-size or large contractors<\/li>\n<\/ul>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<a target=\"_blank\" href=\"\/learn\/#schedule-a-live-demo\" class=\"blog-cta-image\"><img decoding=\"async\" src=\"\/wp-content\/uploads\/2024\/03\/FSL-blog-post-ad-see-how.png\" alt=\"Get a Demo\" title=\"Get a Demo\"><\/a>\n<h2><span class=\"ez-toc-section\" id=\"Conclusion\"><\/span>Conclusion<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>Cash-basis accounting and accrual-basis accounting each offer contractors distinct benefits and considerations. The biggest difference comes down to whether you report income and expenses when cash changes hands or when you know it <em>will <\/em>change hands. This choice has several implications for your business and, in some cases, requirements. If your average annual receipts exceed $5 million, you\u2019ll likely need to select an accrual method with your construction CPA. In either case, we recommend working with a <a href=\"https:\/\/www.foundationsoft.com\/construction-cpa\/\">CPA who specializes in construction<\/a> to determine the best method for you.<\/p>\n<p><a class=\"gdlr-button medium without-border\" href=\"\/construction-cpa\/\" target=\"_self\"  style=\"color:#ffffff; background-color:#000000; \"  >Find a construction CPA \u00bb<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Whether you recognize revenue with the cash method or the accrual method is all about knowing how much cash you have and when \u2014 plus how much the IRS gets!<\/p>\n","protected":false},"author":17,"featured_media":14142,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_searchwp_excluded":"","inline_featured_image":false,"footnotes":""},"categories":[9,16],"tags":[11,20],"class_list":["post-10944","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-articles","category-reporting-bookkeeping","tag-construction-reporting","tag-video"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v26.0 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Cash vs. Accrual: Best Accounting for Contractors<\/title>\n<meta name=\"description\" content=\"Cash vs. accrual accounting impacts everything from tax liability to financial clarity. Learn which method gives contractors the most accurate picture of business health.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.foundationsoft.com\/learn\/cash-vs-accrual-accounting\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Cash vs. Accrual Accounting: The Difference for Your Construction Business\" \/>\n<meta property=\"og:description\" content=\"Whether you recognize revenue with the cash method or the accrual method is all about knowing how much cash you have and when \u2014 plus how much the IRS gets!\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.foundationsoft.com\/learn\/cash-vs-accrual-accounting\/\" \/>\n<meta property=\"og:site_name\" content=\"Foundation Software\" \/>\n<meta property=\"article:published_time\" content=\"2018-07-16T17:41:22+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2025-05-05T13:15:06+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/www.foundationsoft.com\/wp-content\/uploads\/2018\/07\/Cash-vs-Accrual.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"750\" \/>\n\t<meta property=\"og:image:height\" content=\"330\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"Frank Osborn\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:title\" content=\"Cash vs. Accrual Accounting: The Difference for Your Business\" \/>\n<meta name=\"twitter:description\" content=\"Whether you recognize revenue with the cash method or accrual method is about knowing how much cash you have &amp; when - plus how much you keep!\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Frank Osborn\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"7 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"WebPage\",\"@id\":\"https:\/\/www.foundationsoft.com\/learn\/cash-vs-accrual-accounting\/\",\"url\":\"https:\/\/www.foundationsoft.com\/learn\/cash-vs-accrual-accounting\/\",\"name\":\"Cash vs. Accrual: Best Accounting for Contractors\",\"isPartOf\":{\"@id\":\"https:\/\/www.foundationsoft.com\/#website\"},\"primaryImageOfPage\":{\"@id\":\"https:\/\/www.foundationsoft.com\/learn\/cash-vs-accrual-accounting\/#primaryimage\"},\"image\":{\"@id\":\"https:\/\/www.foundationsoft.com\/learn\/cash-vs-accrual-accounting\/#primaryimage\"},\"thumbnailUrl\":\"https:\/\/www.foundationsoft.com\/wp-content\/uploads\/2018\/07\/Cash-vs-Accrual.jpg\",\"datePublished\":\"2018-07-16T17:41:22+00:00\",\"dateModified\":\"2025-05-05T13:15:06+00:00\",\"author\":{\"@id\":\"https:\/\/www.foundationsoft.com\/#\/schema\/person\/f4d81e1915582d565569c791665f80da\"},\"description\":\"Cash vs. accrual accounting impacts everything from tax liability to financial clarity. Learn which method gives contractors the most accurate picture of business health.\",\"breadcrumb\":{\"@id\":\"https:\/\/www.foundationsoft.com\/learn\/cash-vs-accrual-accounting\/#breadcrumb\"},\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\/\/www.foundationsoft.com\/learn\/cash-vs-accrual-accounting\/\"]}]},{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\/\/www.foundationsoft.com\/learn\/cash-vs-accrual-accounting\/#primaryimage\",\"url\":\"https:\/\/www.foundationsoft.com\/wp-content\/uploads\/2018\/07\/Cash-vs-Accrual.jpg\",\"contentUrl\":\"https:\/\/www.foundationsoft.com\/wp-content\/uploads\/2018\/07\/Cash-vs-Accrual.jpg\",\"width\":750,\"height\":330,\"caption\":\"Cash vs. Accrual Accounting: The Difference for Your Construction Business\"},{\"@type\":\"BreadcrumbList\",\"@id\":\"https:\/\/www.foundationsoft.com\/learn\/cash-vs-accrual-accounting\/#breadcrumb\",\"itemListElement\":[{\"@type\":\"ListItem\",\"position\":1,\"name\":\"Home\",\"item\":\"https:\/\/www.foundationsoft.com\/\"},{\"@type\":\"ListItem\",\"position\":2,\"name\":\"Cash vs. Accrual Accounting: The Difference for Your Construction Business\"}]},{\"@type\":\"WebSite\",\"@id\":\"https:\/\/www.foundationsoft.com\/#website\",\"url\":\"https:\/\/www.foundationsoft.com\/\",\"name\":\"Foundation Software\",\"description\":\"Construction Software for Contractors\",\"potentialAction\":[{\"@type\":\"SearchAction\",\"target\":{\"@type\":\"EntryPoint\",\"urlTemplate\":\"https:\/\/www.foundationsoft.com\/?s={search_term_string}\"},\"query-input\":{\"@type\":\"PropertyValueSpecification\",\"valueRequired\":true,\"valueName\":\"search_term_string\"}}],\"inLanguage\":\"en-US\"},{\"@type\":\"Person\",\"@id\":\"https:\/\/www.foundationsoft.com\/#\/schema\/person\/f4d81e1915582d565569c791665f80da\",\"name\":\"Frank Osborn\",\"image\":{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\/\/www.foundationsoft.com\/#\/schema\/person\/image\/\",\"url\":\"https:\/\/www.foundationsoft.com\/wp-content\/uploads\/2021\/04\/frank-osborn-150x150.png\",\"contentUrl\":\"https:\/\/www.foundationsoft.com\/wp-content\/uploads\/2021\/04\/frank-osborn-150x150.png\",\"caption\":\"Frank Osborn\"}}]}<\/script>\n<!-- \/ Yoast SEO plugin. -->","yoast_head_json":{"title":"Cash vs. Accrual: Best Accounting for Contractors","description":"Cash vs. accrual accounting impacts everything from tax liability to financial clarity. Learn which method gives contractors the most accurate picture of business health.","robots":{"index":"index","follow":"follow","max-snippet":"max-snippet:-1","max-image-preview":"max-image-preview:large","max-video-preview":"max-video-preview:-1"},"canonical":"https:\/\/www.foundationsoft.com\/learn\/cash-vs-accrual-accounting\/","og_locale":"en_US","og_type":"article","og_title":"Cash vs. Accrual Accounting: The Difference for Your Construction Business","og_description":"Whether you recognize revenue with the cash method or the accrual method is all about knowing how much cash you have and when \u2014 plus how much the IRS gets!","og_url":"https:\/\/www.foundationsoft.com\/learn\/cash-vs-accrual-accounting\/","og_site_name":"Foundation Software","article_published_time":"2018-07-16T17:41:22+00:00","article_modified_time":"2025-05-05T13:15:06+00:00","og_image":[{"width":750,"height":330,"url":"https:\/\/www.foundationsoft.com\/wp-content\/uploads\/2018\/07\/Cash-vs-Accrual.jpg","type":"image\/jpeg"}],"author":"Frank Osborn","twitter_card":"summary_large_image","twitter_title":"Cash vs. Accrual Accounting: The Difference for Your Business","twitter_description":"Whether you recognize revenue with the cash method or accrual method is about knowing how much cash you have & when - plus how much you keep!","twitter_misc":{"Written by":"Frank Osborn","Est. reading time":"7 minutes"},"schema":{"@context":"https:\/\/schema.org","@graph":[{"@type":"WebPage","@id":"https:\/\/www.foundationsoft.com\/learn\/cash-vs-accrual-accounting\/","url":"https:\/\/www.foundationsoft.com\/learn\/cash-vs-accrual-accounting\/","name":"Cash vs. Accrual: Best Accounting for Contractors","isPartOf":{"@id":"https:\/\/www.foundationsoft.com\/#website"},"primaryImageOfPage":{"@id":"https:\/\/www.foundationsoft.com\/learn\/cash-vs-accrual-accounting\/#primaryimage"},"image":{"@id":"https:\/\/www.foundationsoft.com\/learn\/cash-vs-accrual-accounting\/#primaryimage"},"thumbnailUrl":"https:\/\/www.foundationsoft.com\/wp-content\/uploads\/2018\/07\/Cash-vs-Accrual.jpg","datePublished":"2018-07-16T17:41:22+00:00","dateModified":"2025-05-05T13:15:06+00:00","author":{"@id":"https:\/\/www.foundationsoft.com\/#\/schema\/person\/f4d81e1915582d565569c791665f80da"},"description":"Cash vs. accrual accounting impacts everything from tax liability to financial clarity. Learn which method gives contractors the most accurate picture of business health.","breadcrumb":{"@id":"https:\/\/www.foundationsoft.com\/learn\/cash-vs-accrual-accounting\/#breadcrumb"},"inLanguage":"en-US","potentialAction":[{"@type":"ReadAction","target":["https:\/\/www.foundationsoft.com\/learn\/cash-vs-accrual-accounting\/"]}]},{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/www.foundationsoft.com\/learn\/cash-vs-accrual-accounting\/#primaryimage","url":"https:\/\/www.foundationsoft.com\/wp-content\/uploads\/2018\/07\/Cash-vs-Accrual.jpg","contentUrl":"https:\/\/www.foundationsoft.com\/wp-content\/uploads\/2018\/07\/Cash-vs-Accrual.jpg","width":750,"height":330,"caption":"Cash vs. Accrual Accounting: The Difference for Your Construction Business"},{"@type":"BreadcrumbList","@id":"https:\/\/www.foundationsoft.com\/learn\/cash-vs-accrual-accounting\/#breadcrumb","itemListElement":[{"@type":"ListItem","position":1,"name":"Home","item":"https:\/\/www.foundationsoft.com\/"},{"@type":"ListItem","position":2,"name":"Cash vs. Accrual Accounting: The Difference for Your Construction Business"}]},{"@type":"WebSite","@id":"https:\/\/www.foundationsoft.com\/#website","url":"https:\/\/www.foundationsoft.com\/","name":"Foundation Software","description":"Construction Software for Contractors","potentialAction":[{"@type":"SearchAction","target":{"@type":"EntryPoint","urlTemplate":"https:\/\/www.foundationsoft.com\/?s={search_term_string}"},"query-input":{"@type":"PropertyValueSpecification","valueRequired":true,"valueName":"search_term_string"}}],"inLanguage":"en-US"},{"@type":"Person","@id":"https:\/\/www.foundationsoft.com\/#\/schema\/person\/f4d81e1915582d565569c791665f80da","name":"Frank Osborn","image":{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/www.foundationsoft.com\/#\/schema\/person\/image\/","url":"https:\/\/www.foundationsoft.com\/wp-content\/uploads\/2021\/04\/frank-osborn-150x150.png","contentUrl":"https:\/\/www.foundationsoft.com\/wp-content\/uploads\/2021\/04\/frank-osborn-150x150.png","caption":"Frank Osborn"}}]}},"_links":{"self":[{"href":"https:\/\/www.foundationsoft.com\/wp-json\/wp\/v2\/posts\/10944","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.foundationsoft.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.foundationsoft.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.foundationsoft.com\/wp-json\/wp\/v2\/users\/17"}],"replies":[{"embeddable":true,"href":"https:\/\/www.foundationsoft.com\/wp-json\/wp\/v2\/comments?post=10944"}],"version-history":[{"count":0,"href":"https:\/\/www.foundationsoft.com\/wp-json\/wp\/v2\/posts\/10944\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.foundationsoft.com\/wp-json\/wp\/v2\/media\/14142"}],"wp:attachment":[{"href":"https:\/\/www.foundationsoft.com\/wp-json\/wp\/v2\/media?parent=10944"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.foundationsoft.com\/wp-json\/wp\/v2\/categories?post=10944"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.foundationsoft.com\/wp-json\/wp\/v2\/tags?post=10944"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}