This portion of the book is focused on closing information and procedures related to accrual accounting.

It is important to understand that Indiana University utilizes the accrual accounting method. Accrual accounting is a method that records revenue when it is earned and records expenses when they are incurred, not when the cash is received or expenses are paid. This method of accounting impacts closing as accrual entries must be posted to recognize revenue and expenses in the appropriate accounting period. Review this portion of the book to ensure closing processes comply with the accrual accounting method as this helps ensure internal controls are in place and the reported income statement and balance sheet are accurate and complete.