The modified accrual basis is a distinct system of accounting that:

Question

Quizplus · Accepted Answer

The modified accrual basis of accounting records expenditures and fund balances, which differs from both accrual and cash basis accounting. It recognizes revenues when they become available and measurable but only recognizes expenditures when they are paid out of the fund. It also does not recognize long-term assets or liabilities, making it distinct from accrual accounting.

The Modified Accrual Basis Is a Distinct System of Accounting