To provide clear guidance concerning the identification and recording of items included in GitLab’s accrued and other liability accounts. The purpose of monthly accrual processes is to allocate expenses to the proper accounting period and match expenses with related revenues. At the close of each month, accrual processes ensure that all expenses related to that month are correctly included in the company's financial statements. Additionally, this policy establishes standards and guidelines for ensuring that GitLab accounts for monthly accruals in a manner that is compliant with management's objectives and generally accepted accounting principles (GAAP). This policy applies to GitLab and all subsidiaries.
We require that all expenses be recorded, to the greatest degree practical, in the period they are incurred. The accrual process should be completed on a monthly basis to ensure liabilities are recorded accurately in their respective periods.
The following items should be accrued monthly as necessary (note: this list is not all-inclusive):
Obligations that accrue over time are recorded throughout the accounting period in a methodical and rational manner. Obligations that accrue when an event occurs should be recorded at the time of the event.
Factors that are considered in determining the time of recording accrued liabilities include:
The Finance team is responsible for having procedures in place to reconcile accounts monthly and for keeping documentation to support accrued liabilities. Payables and accrued liabilities are recorded at face value, plus or minus any applicable adjustments. In most cases, the payable amount can be determined from the vendor bill. If not, then the amount should be verified against any relevant documents before recording the liability. When actual values are not available, the recorded value should be based on best available estimates. Estimates should be based on current market price and experience/history.
The Controller is responsible for performing an overall review of accrued liabilities, one to three business days after accounts payable closes each month, to help ensure that all expenses are captured accurately.