Oliver is the sole shareholder, director and employee of Northrop Consulting Engineers. Oliver's company owns and operates a spraying aircraft for spraying crops and pastures with either fertilizers or pesticides. The business charges farmers on an hourly basis for the use of the aircraft and for Olivers time in flying the aircraft. Oliver charges $400 per hour of which around $50 per hour would be for his labour. The business also charges farmers for the spray being used. The only way a farmer can engage the aircraft is together with Oliver as the pilot as he lets no one else fly because the aircraft is his major asset. The company maintains simple books of account and records income when it is received. Most clients pay cash on completion of a job. Oliver rarely extends credit to his clients and only in special circumstances. Oliver keeps virtually no supplies of fertiliser or pesticides on hand and orders them for specific jobs. He does have a small amount of fuel and oil in his hanger.

With reference to relevant cases and legislation, critically discuss whether Oliver returns his income for tax purposes on a cash or on an accruals basis?