Definition
Making sure supplier invoices and receipts are recorded in the accounting period in which the goods or services were received.
Also called: cutoff, AP cutoff
Key points
- Invoices received after the close for earlier deliveries are accrued, often as GRNI.
- Weak cutoff moves expenses between months and makes accruals pile up.
- Accruals not reversed when the invoice arrives can lead to the expense being recorded twice.
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