Features Ledger

Crunched aligns with your business style, and your necessary settings.

Feel confident when posting transactions into your ledger that your reports will accurately reflect the financial activity of your business. Crunched has designed various internal checkpoints to ensure your success and promote accuracy. Following a standard, double entry style accounting method, your general ledger report will be quickly legible by yourself and financial professionals when making various financial decisions.



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Cash vs. Accrual

Cash and accrual accounting methods are commonly used in small business depending on reporting requirements, personal preference, and professional recommendation. For more information on cash and accrual methods in Crunched, see below.

Income

The cash basis method records income when cash has been received. In Crunched, invoicing a customer under the cash basis method does not generate “income”, the income is generated upon receiving a customer payment and applying it to an open invoice.

Invoice with paid stamp

Expenses

Similar to the effects of cash basis on income, the expense is not incurred until the expense has been paid or disbursed. In Crunched, when you add a bill to your payables, the expense is not yet recorded. Under the cash basis method, the expense in generated upon paying the bill and reducing the payable amount.

Expense receipt
Cash accounting method report

Reporting

Reporting under the cash basis method truly reflects the movement of cash within your business. Just because you sent an invoice does not mean that you have reportable income, and same for expenses. Under the cash basis method of reporting in Crunched, all of your respective financial reports will reflect the collection or disbursement of cash.

Invoice with delivered stamp

Income

The accrual method records income when the customer has been invoiced for services or sales items. In Crunched, invoicing a customer under the accrual method generates reportable income. While this method may show a more realistic presentation of your business’s operations, it generally does not reflect the movement of cash.

Mailed bill

Expenses

Similar to the effects of income under the accrual method of accounting, expenses are incurred when the bill is received, not paid. In Crunched, when you record your bill into the payables system, the expense is then reflected in various financial reports. Regardless of when the bill is paid, the expense has been incurred.

Reporting

Reporting under the accrual method truly reflects the operations of your business. When reporting invoices when services are rendered and expenses incurred you are able to gain a better understanding of productivity, profitability, and overall business operations. While a cash flow statement may be required to understand your movement of cash within the period, viewing financial reports in the accrual method will help with financial decision making.

Accrual accounting method report

Year End Closing Entries

At year end, it is important that your books get a fresh start! This happens with an automated journal entry that gets recorded when starting a new year. The journal entry that is defined within the business owner’s system settings reduces income and expenses down to zero and adjusts owner's equity or retained earnings account. For more information, be sure to check out this help center article.



Crunched closing entry example

Customize and Import Your Own Chart of Accounts

A properly designed and implemented chart of accounts is key to accurate, clearly stated financial reports. In Crunched, you have the ability to import an existing chart of accounts, utilize our preformatted templates, or design your own. To learn how to import an existing chart of accounts, click below.


Import Chart of Accounts

Need help getting started?

Here are a few help center articles and blogs that will help you learn about the different accounting methods and the back end ledger system.

Getting Started Guide: Accounting System
Guide

How To Import Journal Entries
Help Center

Basic Accounting Formulas
Blog
 
General ledger graphic
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Income | Expenses | Reporting

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