Cash Basis Adjustment

Cash Basis Adjustments

Brief Accounting in an accrual based accounting system. There is a process that can be run to make the necessary adjustment each month so that firms may operate and produce financials on a cash basis. This procedure is called the Cash Basis Adjustment (CBA). The CBA is necessary in order to adjust the 2 accrual accounting modules, Accounts Receivable and Accounts Payable, to cash basis.

In Accounts Receivable, the CBA backs out the billed but unrealized (uncollected) fees from the Revenue general ledger accounts.

The CBA does this by making an Adjusting Journal Entry (AJE). The Fees and Expenses are backed out on the last day of the month for which the CBA is being made. They are brought back in again on the first day of the following month. For this reason, A CBA needs to be run every month if you produce monthly financials.

To run a CBA:

Choose the GL module > AJE tab:



From the Special menu at the top of your screen, select Cash Basis Adjustment.

Enter the date range of the month in which you want to run the CBA:


Click Adjust.

When the CBA's are created, you will see AJE's similar to below:


Once created, you need to place a checkmark in the Post column beside each CBA and click the Post button.

You can run a CBA for multiple months at a time. Just use the first day of the month in which you wish to start, and the last day of the month in which you wish to end. Individual CBA's will be created for each month of the date range that is selelcted.

TIP: To select all AJE's at once to post, clicl the red button beside the "Post" column heading:


This will select all items on the screen.

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