Ah, so Accrual focuses on flow of intrinsic value? The *intent* is that there's ultimately no net out-of-pocket/expense so there shouldn't be any deficit/expense on paper. I like that. I'm convinced on *Assets:AccountsReceivable:** instead of *Expenses:** for cash-out and cash-in legs of claim. Especially for big claims, probably routine medical claims. Maybe not 1-2% cash back on credit cards... I'll have to look at remodeling some of my own slush accounts.
On Fri, Jun 21, 2024, 12:44 Chary Chary <[email protected]> wrote: > > > On Friday, June 21, 2024 at 5:53:35 PM UTC+2 [email protected] wrote: > > > If you don't want to see the deficit reflected in your net worth, I'm > warming to the Assets:Receivable idea. You are reasonably expected to > receive the funds, as much as your Liabilities are expected to receive back > from you. It just seems weird to not send money to Expenses when you're > buying (replacement) things/services. > > > I think you method is what is call a* cashflow - based accounting* and my > method is what is *called an accrual accounting * > https://www.youtube.com/watch?v=eApsfjccm7s > > In my experience it is OK to use a *cashflow - based accounting* for > small expenses, which kind of stay on the noise level. > > But if you use a *cashflow - based accounting *for significant but > irregular transactions (e.g. big tax return from the last year, expected > big tax to be paid for this year, lending or borrowing a large amount of > money), then your net worth starts fluctuating to the level, that you just > don't understand what is going on any longer and also can't compare similar > periods of different years. But the beauty of a double entry system is that > you can remove all this noise and see the true picture by using accrual > accounting. > > > -- > You received this message because you are subscribed to the Google Groups > "Beancount" group. > To unsubscribe from this group and stop receiving emails from it, send an > email to [email protected]. > To view this discussion on the web visit > https://groups.google.com/d/msgid/beancount/e88d1422-eb1f-4208-8183-8acb9fda4ff1n%40googlegroups.com > <https://groups.google.com/d/msgid/beancount/e88d1422-eb1f-4208-8183-8acb9fda4ff1n%40googlegroups.com?utm_medium=email&utm_source=footer> > . > -- You received this message because you are subscribed to the Google Groups "Beancount" group. To unsubscribe from this group and stop receiving emails from it, send an email to [email protected]. To view this discussion on the web visit https://groups.google.com/d/msgid/beancount/CANRuw3z%2BchEOsUqmgRXRvYStmev2%2BOUHfN7StqpksTAZPGSj9Q%40mail.gmail.com.
