An accrual is a financial transaction that is recorded in the books of a company before payment is received or made. In accrual accounting, the recognition of revenue and expenses is based on the accrual concept, which records transactions when they are incurred, regardless of when payment is received or made.

An accrual can be either a revenue accrual or an expense accrual. A revenue accrual is a recognition of revenue that has been earned but not yet received, such as a customer order that has been fulfilled but not yet paid for. An expense accrual is a recognition of an expense that has been incurred but not yet paid, such as a supplier invoice that has been received but not yet paid.

Accruals are important because they provide a more accurate picture of a company's financial position, as they take into account all financial transactions that have been incurred, regardless of when payment is received or made.

In summary, an accrual is a financial transaction that is recorded in the books of a company before payment is received or made. Accruals provide a more accurate picture of a company's financial position and are an important part of accrual accounting.