Accrual vs Cash Accounting: Singapore Retailers Need Both (Compliance + Reality)

The Singapore Accounting Dilemma#

GST registration requires accrual accounting for GST filing (IRAS). Invoice date, not payment date. But business owners care about cash: "Do I have money to pay rent?" These are different. Most Singapore SMBs get confused.

Accrual Accounting (GST Compliant)#

Record revenue when invoice issued, expense when bill received (regardless of payment). June: invoice SGD 100K → revenue SGD 100K (even unpaid). Cost: SGD 60K (even if not yet paid). Profit: SGD 40K. GST due: SGD 7K. Used for: tax filing, IRAS submission.

Cash Accounting (Reality)#

Record revenue when cash received, expense when paid. June: zero revenue (no cash received). July: SGD 100K revenue. Profit timing: different month. Used for: cash flow planning, survival.

AskBiz Dual Tracking#

Shows both views. Dashboard: "Accrual profit (GST): SGD 40K. Cash profit (actual): SGD 15K (large unpaid invoice). GST due: SGD 7K. Cash required for GST: SGD 7K (but you only have SGD 15K cash profit, so SGD 8K risk)."

• Retail shop SGD 1M revenue.
• June revenue: SGD 100K (invoiced).
• July payment received.