Accruals

When goods or services have been received but the supplier's invoice has not yet arrived, an accrual records the estimated cost so the expense lands in the period it relates to. This follows the matching principle of accrual accounting and prevents costs from being understated at month-end simply because paperwork is late. Once the invoice arrives, the accrual is reversed and the actual amount booked.

In procurement, accruals depend on accurate goods receipting — a reliable goods received note tells finance what has been delivered and therefore what to accrue. Good commitment and receipt data make accruals faster and more accurate, giving a truer view of spend against budget. Poor receipting, by contrast, leads to guesswork and surprises when invoices finally land.