The goods or the work came this month, but no bill came yet. Is that cost in this month's books?

The delivery or the work decides the month, and the bill does not

A cost that the business used in a month but did not record or pay yet is an accrued expense. It creates a liability that the business must pay later¹. The same textbook matches each cost with the income that it helped to earn¹. So a September cost goes into September, even when the bill comes in October.

A liability needs a future payment that results from an earlier business activity or transaction. Money that you owe suppliers for a purchase on credit is accounts payable². A delivery, or work that a supplier did, is that earlier activity. An order that did not arrive has no such activity yet. That last step is our own reading of the definition.

The answer has two halves. Services that Northbrook used in September become September cost. Goods that are still on the shelf become stock. In general accounting, stock becomes a cost when you sell it. That part is not a rule of the skill.

Twelve items at Northbrook Trading for September 2026

Northbrook Trading keeps its books on the accrual basis, in US dollars, with a calendar year. The month is Tuesday 1 September to Wednesday 30 September 2026. The books close on Saturday 10 October. The skill reads the books through MosoFin. The owner uploads the warehouse log, because the books hold no record of deliveries.

The skill reads every purchase order that is still open, whatever its date. So PO-2033 from July is in the run. The search does not start on 1 September. The skill also reads each line of an order on its own. Line 1 of PO-2033 has its bill, and line 2 has no bill. A total for the whole order can hide the line that has no bill.

The skill's own file states the rule for goods on the shelf:

Goods received and held at period end are stock or equipment, not this month's expense.
references/method.md, Step 5

A month that looks cheaper than it was, and an order that is not owed yet

The skill's own file names the first mistake: "The mistake it catches is a month that looks cheaper than it was." It also catches the opposite mistake: a cost for an order that never arrived.

Auditors of US public companies have names for these two ideas in an audit standard³. Completeness means that every transaction that belongs in the period is there. Occurrence means that each recorded transaction happened in the period. A small business does not apply that standard. But the missing cost is a completeness problem, and the accrued order that never arrived is an occurrence problem.

The skill also stops a third mistake: one cost counted twice. Each cost goes into one group only: goods received, a late bill or a regular supplier. At Northbrook, that rule decides three items:

Bill RW-8812 of 31 August has no order number on it. The skill matches it to PO-2033 line 1 by supplier, date, amount and description. It labels the match as inferred, and it puts the match on the Exceptions sheet. A wrong match gives a double count or a missing 3,000.

Two small items stay out, and every accrual reverses on 1 October

Northbrook set a limit of $500. Accountants call this a materiality threshold. Metro Shred at 120 and Keystone Pest Control at 350 are each below 500. The skill does not accrue them. It lists them with their total, 120 + 350 = $470. The skill also tests the total of the skipped items. Here 470 is below 500, so this example treats them as small together. If you set no limit, the skill accrues everything that it finds and says so.

Each accrual has a reversing entry dated Thursday 1 October, the first day of the next month. The reversal takes the 14,650 out again. Then each real bill goes to the same account as its accrual. When the Ridgeway bill of 4,800 posts to Inventory in October, the reversal cancels it, and the stock appears once.

The table of the balance starts at 1,950 on 31 August: Summit 950 and Crestline 1,000 for August. Both reversed on Tuesday 1 September, and the skill finds the reversals in the books. Accountants call this table a roll-forward. Accrued Expenses also holds the items of the accruals-and-deferrals run. The skill shows them on a separate line and does not work them again.

Five items go to Exceptions: Pinnacle's bill with no dates, the inferred match, the Crestline increase, the open order PO-2044 and the Harbor bill. Each has an owner, an action, a due date of Friday 9 October and the effect if nobody acts. Then the owner says: "Post these in QuickBooks." The skill declines once, in plain words, and gives the owner the drafts.

Seven questions, in one message

The skill asks these first, in one short batch. It asks only for what it cannot already see.

1. Use MosoFin for this run, or upload the data yourself?
   MosoFin is the connection to your books and the other platforms that you link. With it, the skill reads from there. Without it, you upload the files, and the tests are the same. The skill asks only if your account has the MosoFin tools. If not, it says once that the run is manual.
2. Which period, with the exact dates? Do you keep the books on the accrual basis or the cash basis?
   The answer sets every read. Books on the cash basis hold no accruals, so an opening balance of zero can be correct. The skill never chooses the period or the basis for you.
3. Where do you record deliveries: a warehouse system, signed delivery notes, a stock module? Do you have any service confirmations or time sheets?
   Goods received is the quantity that arrived × the order price. Most books hold no delivery record. Without proof of delivery, the skill does not accrue an open order. It lists each line that has no proof.
4. How many days after the month end should it look for late bills?
   Required. The usual answer is "until the books close". The skill proposes that date and waits for your yes. At Northbrook, it is 1 to 10 October.
5. Which account holds the amounts that you owe but have no bill for?
   Required. Every entry credits this account, and the name differs between companies. On the MosoFin path, the skill finds the account in your chart of accounts and confirms it with you by name.
6. Can you recover the tax on your purchases, and in which country or state?
   The answer decides whether an entry has a tax line. The skill never assumes the tax rule. It does not reuse a saved rule until you confirm it again.
7. Is there a materiality threshold? Is it lower at year end?
   The skill can skip items below the limit, and it lists them. If you set none, it accrues everything that it finds and says so.

The basis question matters for tax too. For US tax, an accrual method generally deducts a cost when the events that create the liability occur. You must also be able to calculate the amount with reasonable accuracy, and economic performance must occur⁴. So the date of delivery matters for tax, and the date of payment does not. That is a US tax rule. Your books and your tax return can differ, so ask your accountant about tax.

Then the skill reads the plan back and waits for your yes. This is the skill's own example:

"Building the September AP accrual schedule for Northbrook Trading (accrual basis), with purchase orders, bills and spend history from your Mosofin connection and goods receipts from the warehouse log you uploaded. Late invoices searched 1–10 October, when the books close; accruals credited to Accrued Expenses; materiality $500; accrued net of recoverable tax, no input-tax line. Shall I go ahead?"

On this page, Northbrook's answer to question F is "no recoverable tax". So the amounts carry no tax line.

Connect once, or upload eight items

On the upload path, the skill names each file that it received. It says what it read from each file: the period, the number of rows and the totals. It tells you at once about a file that it cannot read, or a file for the wrong period or company.

Seven sheets, from the summary to the coverage

It asks whether you want an Excel file before it makes one. At Northbrook, the file is AP_Accruals_2026-09_Cutoff.xlsx. If you say no, you get the same sheets as tables in the chat. After you see the results, it offers to save your answers, regular suppliers, accounts and standing exclusions for the next run. It saves them only if you say yes. It never saves your connections, company files, tool settings or test-data status.

Seven terms, in plain English

Accrued expense

A cost that the business used in the period but did not record or pay yet. It creates a liability¹.

Accounts payable

Money that you owe suppliers for goods or services that you bought on credit². Accountants write A/P or AP.

GRNI

Goods received, not invoiced: the goods arrived, and the bill did not.

Purchase order

The order that you place with a supplier. Accountants write PO.

Goods receipt

The record that the goods arrived. Accountants write GRN, for goods receipt note.

Cutoff

The practice of putting each cost in the period where it belongs.

Reversing entry

An entry on the first day of the next period that cancels an accrual. The real bill then posts without a double count.

Where the facts on this page come from

The sources are two sections of an accounting textbook, a US audit standard and a US tax publication. We found each one on 28 October 2026 in search results. We did not open the pages, so follow each link for today's wording. What the skill does comes from the skill's own files.

1. OpenStax: Principles of Accounting, Volume 1, 4.2 Discuss the Adjustment Process and Illustrate Common Types of Adjusting EntriesAccrued expenses are costs of a period that the business did not record yet and did not pay. They create a liability that the business must pay later. The matching principle puts each cost with the income that it helped to earn.
2. OpenStax: Principles of Accounting, Volume 1, 12.1 Identify and Describe Current LiabilitiesA liability needs a future payment of assets or services, and it results from an earlier business activity or transaction. Accounts payable is what a business owes suppliers after a purchase on credit.
3. PCAOB: AS 1105, Audit EvidenceThe assertions of management include existence or occurrence and completeness. Recorded transactions occurred in the period, and all transactions that belong there are in. This standard is for audits of US public companies. We cite it as background only.
4. IRS: Publication 538 (01/2022), Accounting Periods and MethodsUnder an accrual method, you generally deduct a business cost when the all-events test is met and economic performance occurs. This is US tax only. A recurring-item exception has its own conditions.

No outside authority backs the seven intake questions, the three groups and their order, the $500 limit or the 1 to 10 October window. The same is true for the seven sheets and the test of the small items together. They are the skill's own rules, or choices that we made for this example. We made up Northbrook Trading and every figure in the example for this page.