Accrual vs. Cash Basis Bookkeeping for ABA Home Therapy Companies: What’s the Right Fit for Better Financial Decisions?

Aug 4

If you’re running an ABA home therapy company, chances are you’re juggling service delivery, staff schedules, insurance claims, and more—all while trying to make sound financial decisions. But if your books aren't telling the full story, you're flying blind.

One key factor that can drastically affect how you understand your business performance is your method of bookkeeping: accrual basis vs. cash basis. Both methods are valid, but the right choice can mean the difference between reactive and strategic decisions.

Cash Basis: Simplicity & Speed

Cash basis accounting records income when it's received and expenses when they’re paid. It’s straightforward, easy to maintain, and works well for smaller ABA practices with fewer payers or limited financial complexity.

Pros:

Easier to manage
Aligns with actual cash flow
Great for tax simplicity

Cons:

Can give a skewed picture of profitability (especially when reimbursements are delayed)
Hard to track what’s truly earned vs. received

Example:
Let’s say your RBTs delivered $50,000 worth of therapy sessions in June, but you only received $20,000 in July. On a cash basis, July looks good—but it ignores that $30,000 still hasn’t hit your bank account.

Accrual Basis: Clarity & Control

Accrual accounting records revenue when it’s earned (i.e., when services are delivered) and expenses when they’re incurred—even if money hasn’t changed hands yet. This method gives you a more realistic view of your business’s financial health.

Pros:

More accurate financial reporting
Helps track insurance claims and A/R
Essential for forecasting and growth planning

Cons:

Requires more time or systems to manage
Doesn’t reflect actual cash in the bank

Example:
Using accrual, that same $50,000 in delivered services from June shows up in June's revenue, giving you a clear picture of production and outstanding payments. This is essential for planning payroll, managing claims follow-up, and knowing if your margins are sustainable.

Which Is Better for ABA Therapy Companies?

If you're operating a solo or small ABA practice, cash basis might feel simpler. But as you grow, and especially if you’re managing:

multiple staff or contractors
complex insurance billing
deferred reimbursements
strategic hiring or expansion

…then accrual basis is a game-changer.

It allows you to:

Track your true earnings (not just what’s in the bank)
Plan for cash shortages before they happen
Make informed decisions about hiring, investing, or scaling

Final Thought: The Hybrid Approach

Some ABA providers start with cash basis and maintain a second layer of accrual reporting (monthly or quarterly) to get the best of both worlds. If you're not sure where to start, that’s where a specialized ABA bookkeeper can help.

At Keepbooking, we offer both cash and accrual-based reporting, tailored specifically for ABA home therapy companies using CentralReach. Whether you're just starting or scaling up, we make sure your numbers work as hard as you do.

Want help deciding which method is best for your company?
📅 Schedule a free consultation and let’s look at the numbers together.