--- title: Accrued Expenses description: Capturing the balance sheet and cash flow impact --- [Skip to content](https://help.planguru.com/knowledge/planguru-app-online/accrued-expenses#main-content) [![PlanGuru Help Center](https://help.planguru.com/hs-fs/hubfs/logo_PlanGuru_helpcenter.png?width=360&height=50&name=logo_PlanGuru_helpcenter.png)](https://help.planguru.com/knowledge?hsLang=en) - [Your Tickets](https://help.planguru.com/tickets-view) - [Sign out](https://help.planguru.com/_hcms/mem/logout) Open main navigation Close main navigation - [Your Tickets](https://help.planguru.com/tickets-view) - [Sign out](https://help.planguru.com/_hcms/mem/logout) - [Submit a Ticket](https://help.planguru.com/tickets-view/new) [Submit a Ticket](https://help.planguru.com/tickets-view/new?hsLang=en) Hello. What do you need help with? - There are no suggestions because the search field is empty. 1. [Help Center](https://help.planguru.com/knowledge?hsLang=en) 2. [PlanGuru App (Online)](https://help.planguru.com/knowledge/planguru-app-online?hsLang=en) 3. [Forecasting & Modeling](https://help.planguru.com/knowledge/planguru-app-online?hsLang=en#forecasting-modeling) # Accrued Expenses ## Capturing the balance sheet and cash flow impact     #### 💵 Accrued Expenses Projection Method When forecasting expenses, there is often a difference between the **timing of expense recognition** and the **actual cash outflow**. Accurately modeling both is essential for maintaining realistic projections of **profitability and cash flow**. --- ### 1️⃣ Overview The **Accrued Expenses projection method** automates the process of recognizing an expense on the **Income Statement** while recording a **liability** on the **Balance Sheet**, then paying it according to a defined schedule. This is the simplest and most accurate way to forecast **expense accruals** and their **cash flow impact** within PlanGuru. **Example:** You have a $400 expense that is incurred monthly, but paid **quarterly** beginning in **March**. ![](https://help.planguru.com/hs-fs/hubfs/image-24.png?width=600&height=252&name=image-24.png) --- ### 2️⃣ When to Use This Method Use this projection method when: - Expenses are recognized before payment (e.g., insurance, payroll taxes, utilities). - You want to reflect **liabilities** on the Balance Sheet until payment occurs. - You need cash flow to match real-world payment timing. --- ### 3️⃣ How to Set Up an Accrued Expense #### **Step 1 – Add a New Liability Account** Go to your **Balance Sheet** and add a new account under the **Current Liabilities** section. ![](https://help.planguru.com/hs-fs/hubfs/image-16.png?width=600&height=252&name=image-16.png) --- #### **Step 2 – Define the Account Type** When prompted, set the **Account Type** to **Other Current Liabilities**. This allows the account to be linked to expenses that have delayed payments. ![](https://help.planguru.com/hs-fs/hubfs/image-19.png?width=958&height=345&name=image-19.png) --- #### **Step 3 – Apply the Accrued Expenses Forecast Method** Then select the **Accrued Expenses** projection method. ![](https://help.planguru.com/hs-fs/hubfs/image-20.png?width=847&height=569&name=image-20.png) --- #### **Step 4 – Set the Payment Interval** Under the “Credit Prepaid” or **Payment Interval** setting, choose how often payments will occur. In this example, select **Quarterly**. ![](https://help.planguru.com/hs-fs/hubfs/image-21.png?width=821&height=650&name=image-21.png) --- #### **Step 5 – Define First Payment Month** Choose the first month when the liability will be paid. For this example, select **March**. ![](https://help.planguru.com/hs-fs/hubfs/image-22.png?width=807&height=624&name=image-22.png) --- #### **Step 6 – Link the Expense Account** Select which **Expense** or **Non-Financial** account will accrue to this liability. PlanGuru will automatically record monthly expense recognition and apply payments based on your schedule. ![](https://help.planguru.com/hs-fs/hubfs/image-23.png?width=880&height=332&name=image-23.png) --- ### 4️⃣ Results Once configured: - The expense will appear each month on the **Income Statement**. - The **liability balance** will accumulate on the **Balance Sheet**. - The liability will **reduce** when payments occur (e.g., quarterly starting in March). ![](https://help.planguru.com/hs-fs/hubfs/image-24.png?width=1062&height=93&name=image-24.png) This ensures that both **profitability** and **cash flow** are represented accurately in your forecasts. - [PlanGuru App (Online)](https://help.planguru.com/knowledge/planguru-app-online?hsLang=en#main-content) - [Getting Started](https://help.planguru.com/knowledge/planguru-app-online?hsLang=en#getting-started) - [Setup & Import](https://help.planguru.com/knowledge/planguru-app-online?hsLang=en#setup-import) - [Company Management](https://help.planguru.com/knowledge/planguru-app-online?hsLang=en#company-management) - [Forecasting & Modeling](https://help.planguru.com/knowledge/planguru-app-online?hsLang=en#forecasting-modeling) - [PlanGuru Analytics (powered by Reach Reporting)](https://help.planguru.com/knowledge/planguru-app-online?hsLang=en#planguru-analytics-powered-by-reach-reporting) - [Standard Reports](https://help.planguru.com/knowledge/planguru-app-online?hsLang=en#standard-reports) - [Updates](https://help.planguru.com/knowledge/planguru-app-online?hsLang=en#updates) - [PlanGuru Desktop (Windows)](https://help.planguru.com/knowledge/planguru-desktop-windows?hsLang=en#main-content) - [Updates](https://help.planguru.com/knowledge/planguru-desktop-windows?hsLang=en#updates) - [Getting Started](https://help.planguru.com/knowledge/planguru-desktop-windows?hsLang=en#getting-started) - [Navigating PlanGuru Desktop](https://help.planguru.com/knowledge/planguru-desktop-windows?hsLang=en#navigating-planguru-desktop) - [Setup & Maintenance](https://help.planguru.com/knowledge/planguru-desktop-windows?hsLang=en#setup-maintenance) - [QuickBooks Online Import](https://help.planguru.com/knowledge/planguru-desktop-windows?hsLang=en#quickbooks-online-import) - [QuickBooks Desktop Import](https://help.planguru.com/knowledge/planguru-desktop-windows?hsLang=en#quickbooks-desktop-import) - [Excel Import](https://help.planguru.com/knowledge/planguru-desktop-windows?hsLang=en#excel-import) - [Analysis Setup](https://help.planguru.com/knowledge/planguru-desktop-windows?hsLang=en#analysis-setup) - [Forecasting & Modeling](https://help.planguru.com/knowledge/planguru-desktop-windows?hsLang=en#forecasting-modeling) - [Installation](https://help.planguru.com/knowledge/planguru-desktop-windows?hsLang=en#installation) - [Licensing](https://help.planguru.com/knowledge/planguru-desktop-windows?hsLang=en#licensing) - [Managing your PlanGuru Files](https://help.planguru.com/knowledge/planguru-desktop-windows?hsLang=en#managing-your-planguru-files) - [Reporting](https://help.planguru.com/knowledge/planguru-desktop-windows?hsLang=en#reporting) - [PlanGuru Analytics](https://help.planguru.com/knowledge/planguru-desktop-windows?hsLang=en#planguru-analytics) - [Technical Inquiries](https://help.planguru.com/knowledge/planguru-desktop-windows?hsLang=en#technical-inquiries) - [PlanGuru Desktop in Cloud Hosting](https://help.planguru.com/knowledge/planguru-desktop-windows?hsLang=en#planguru-desktop-in-cloud-hosting) - [Advanced Reporting Excel Add-in](https://help.planguru.com/knowledge/planguru-desktop-windows?hsLang=en#advanced-reporting-excel-add-in) - [PlanGuru University](https://help.planguru.com/knowledge/planguru-university?hsLang=en) - [PRODUCTS & PRICING](https://www.planguru.com/products/) - CUSTOMERS - [Small Businesses](https://www.planguru.com/users/small-business/) - [Nonprofits](https://www.planguru.com/users/nonprofit/) - [Accountants / Advisors](https://www.planguru.com/users/accountants-business-advisors/) - LEARNING - [Attend a Live Demo](https://www.planguru.com/products/planguru-webinar-signup/) - [PlanGuru University](https://www.planguru.com/planguru-university/) - [Sign Up for PGU](https://www.planguru.com/planguru-university/) - [PGU Class Materials & Recordings](https://www.planguru.com/planguru-university/class-materials/) - [Video Tutorials](https://www.planguru.com/learning-resources/learning-center/) - [Help Center](https://help.planguru.com/knowledge) - SUPPORT - [Help Center/ Submit a Ticket](https://help.planguru.com/knowledge) - [Downloads / Updates](https://www.planguru.com/support/downloads/) - [Try it FREE](https://www.planguru.com/products/trial/) [![logo_PlanGuru_190-1](https://help.planguru.com/hs-fs/hubfs/logo_PlanGuru_190-1.png?width=190&height=55&name=logo_PlanGuru_190-1.png "logo_PlanGuru_190-1")](https://www.planguru.com/) Copyright © 2025, PlanGuru