An accruals workpaper lists every expense incurred but not yet invoiced at period end, with the basis for each amount, the evidence behind it, the journal it supports and the reversal date. Copy the template below, add one row per accrual, and have a person review and post. A filled sample shows the level of detail auditors expect.
What does an accruals workpaper do?
It is the bridge between the accrual journal and the reality behind it. The journal says "accrue 4,000 for consultancy". The workpaper says why 4,000, from which contract, for which days of work, confirmed by whom, and when it reverses. Without it the journal is an assertion. With it, a reviewer or auditor can re-perform the figure. That traceability is the standard set in AI agents for finance: books you can audit.
For an AI agent preparing accruals, the workpaper matters even more. It is where the agent shows its working, and where the person who posts can see exactly which facts the agent relied on. The question of whether an agent should post at all is covered in whether an AI agent can post accruals and prepayments. Our view is that the agent prepares and a person posts.
When should you use it?
Prepare it every month-end, after the cut-off for invoices received and before the close review. The agent can start earlier: from the first working day after period end it can scan purchase orders, goods received notes and unbilled contracts for candidates, then fill the workpaper as evidence arrives.
The full process, including how the agent finds candidates, is in how to run month-end accruals with an AI agent.
How do you fill in each field?
- Basis is one of a short list: purchase order received not invoiced, contract time-based, usage-based, estimate from prior months, or manager confirmation. Each basis needs a different kind of evidence.
- Calculation should be written so it can be re-performed: "20 days at 200 per day" rather than "4,000".
- Evidence links to the documents. If the only evidence is an email from a budget holder, say so; that is a weaker basis and the reviewer should know.
- Provenance records where each fact came from. A figure read from your own purchase order system is stronger than one taken from a supplier's email.
- Reversal gives the date and confirms the reversing journal is scheduled. Forgotten reversals double-count expenses.
- Prior period check compares to last month's accrual for the same item and explains any large change.
The accruals workpaper template
| Field | Guidance |
|---|---|
| Ref | Line reference, such as ACC-07 |
| Supplier or counterparty | Name as in the supplier master |
| Description | What was received and when |
| Cost centre and account | Where the expense lands |
| Basis | PO not invoiced, contract, usage, estimate, confirmation |
| Calculation | Quantity, rate, period; re-performable |
| Amount | Accrual amount |
| Evidence | Document references with links |
| Fact provenance | System of record, named confirmer, or external document |
| Prior period amount | Same line last month |
| Variance explanation | Required if the movement is material |
| Reversal date | Usually first day of next period |
| Prepared by | Agent name and version, or person |
| Reviewed and posted by | Named person and date |
| Journal reference | Posted journal number |
Keep a control total at the foot that ties the workpaper to the accrual balance on the trial balance. The same tie-out approach is used in the bank reconciliation template.
A filled sample
A hypothetical software company, three lines at month-end.
| Ref | Supplier | Basis | Calculation | Amount | Evidence | Provenance | Prior | Variance note | Reversal |
|---|---|---|---|---|---|---|---|---|---|
| ACC-01 | Cloud hosting provider | Usage | Usage dashboard, 1 to 31, at contract rates | 12,400 | Usage export, contract schedule | Usage export external; contract sealed in contract system | 11,900 | Higher traffic from product launch | Day 1 next month |
| ACC-02 | Design agency | PO not invoiced | PO 4431, milestone 2 signed off on the 24th | 6,000 | PO, sign-off email from project lead | PO sealed; sign-off signed by named lead | 0 | New milestone | Day 1 next month |
| ACC-03 | Legal adviser | Estimate | 15 hours at 300, per partner's monthly note | 4,500 | Partner's note | External | 3,000 | More hours on contract review | Day 1 next month |
The reviewer's eye should go to ACC-03. It rests on an external note only, so the reviewer asks the budget holder to confirm the hours before posting. The workpaper made that weakness visible; it did not hide it in a total.
Questions people ask
Should accruals below a threshold be included?
Set a materiality threshold and record items below it in a single summary line, with the method. Leaving them out entirely makes the workpaper harder to reconcile to the ledger.
Can the agent estimate accruals from prior months?
It can propose an estimate, but it must say it is an estimate and show the months used. A person decides whether the estimate is reasonable given what they know about the period.
How long should accruals workpapers be kept?
Keep them with the period's close file for as long as your accounting records must be kept under local law. Store the evidence links, not just the summary.