Accrual v/s outstansing

Save Share

This query is : Resolved

Nikitha P Jain (Querist)

02 August 2014 I want to know the difference between the terms accruals and outstanding. Please tell me the difference as soon as possible.

CA Devanand Jethanandani

CA Devanand Jethanandani (Expert)

02 August 2014 Hi Nikitha,

Good question asked by you.

Outstanding:
Outstanding means amount payable showing in the books of accounts.

Accrual:
This term will be better understood by an example,
suppose there is a rent payable to landlord on quarterly basis (calendar quarter) Rs.15000 per quarter. On 30th april the rent becomes accrued Rs.5000 (15000/3 months), we do not provide the same in the books as is accrued but not due. I will due at the end of particular quarter (i.e. on 30th june)
On 30th june rent will be accrued and due Rs.15000 and the same will be termed as Outstanding.

Here you will learn one more term i.e. due.

Difference in accrued and due.
In the given example, rent becomes accrued but not due on 30th april, while on 30th june it will be accrued and due.

Hope this will make you clear about the terms.

Thanks,
Devanand

Vishnu Saboo

Vishnu Saboo (Expert)

04 August 2014 Outstanding - which is due but not paid.
Accrued - expenses incurred but they are not liable to paid, as they are not yet due.
for revealing the real picture of P&L, both to be considered.

You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now