Money to which a company is entitled because it has reached a certain milestone in a contract but when the contract terms do not allow the company to issue an invoice for the work completed. This receivable may also be accrued when the contract will pay the company for hours worked, rather than for a specific work product. Generally, receivables are accrued at year end to match revenues to expenses incurred. The corresponding revenue underlying the accrued receivable is an accrued revenue. Classified as a current asset.
