In accounting and finance, an accrual is an asset or liability that represents revenue or expenses that are receivable or payable but which have not yet been paid.
Accrual accounting recognizes revenues and expenses when they are earned or incurred, not necessarily when cash is received or paid.
Similarly, the company who receives the product also recognizes the expenses incurred in the current financial year, even if the actual payment is made later.
[citation needed] An accrued expense is a liability for goods or services received but not yet paid for.
By contrast: In payroll, a common benefit that an employer will provide for employees is a vacation or sick accrual.