Explain the difference between cash-basis and accrual-basis accounting.

- Cash-basis and accrual-basis accounting are two alternatives for recording business activities in the accounting records. IFRS and ASPE require the use of accrual-basis accounting.

- Under cash-basis accounting, revenues and expenses are recorded when cash is received or paid, regardless of when the revenues are earned or the expenses are incurred.

- Accrual-basis accounting links income measurement to the earnings activities of a company by recognizing revenues and expenses when they occur.