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Compensation Agreement Journal - delayed payment

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A Settlement /Compensation agreement has been signed in Jan,  however the 9x payments are not due to be paid for 3 months (Apr), Im pondering the best way to post this into the accounts, any sugestions

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By Mike Bath
21st Feb 2019 14:35

Assuming that there are no performance conditions, the liability to make the payment exists from the point where the contract is signed. At the date of signing you have a double entry that is Dr Staff costs Cr Accruals. When the payments are made it's Dr Accruals Cr Bank.

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By WAA
22nd Feb 2019 10:11

Thanks Mike. I appropriate your reply

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