Accruals and Provisions

An accrual is where we are certain that we will be owing money (even if we are not certain of exactly how much). A provision if where we might be owing money but are not certain that we will be having to pay. Electricity is an accrual - we know that we have used electricity and we are certain that we are going to have to pay something. Have you watched my free lectures on accruals and on IAS 37? The lectures are a complete free course for Paper FA and cover everything needed to be able to pass the exam well.

You are welcome :-)