For example, if a company completes a service for a customer in December, but doesn't receive payment until January, the revenue will be recorded as an accrual in December, even though the cash isn't received until January. Similarly, if a company incurs an expense for supplies in December, but doesn't pay for them until January, the expense will be recorded as an accrual in December. Accruals allow companies to better match their revenues and expenses in the same period, providing a more accurate view of their financial health.