Performance Fees Accrual Journal Entry

If Performance Fees is not paid in cash / bank but it is paid after receiving services from investment manager, then it is accrued for the period until it is fully paid to investment manager. So, it is a current liability of the company to pay to investment manager for the services rendered to it.

The adjusting entry to record accrued performance fees entry is given below:

 

                                       Performance Fees a/c  XXX

 

                                                                        Accrued Performance Fees a/c  XXX

                                         (Performance Fees Accrued for the Period)

Accrual Performance Fees or Accrued Performance Fees is recorded in balance sheet as a current liability on the Liabilities And Equity side as it is a Permanent Account.

Accrued Performance Fees is also known as Outstanding Performance Fees or Performance Fees Payable.