Why Employee Allowances Don’t Have Separate Accounts and How to Record Them Accounting-Wise

An explanation for why employee allowances such as housing allowance are reflected in the accounts and how to handle them in the system.

Answer:

• Allowances such as housing allowance are linked directly to the ‘Accrued Salaries’ account.
• There is no separate account designated for these allowances and it is not possible to assign a specific account to them.