Generally, outstanding assets are those items for which amounts are yet to be received though services, etc. have been rendered, or items for which benefit of service will be received later.

It is a well accepted accounting principle that all expenditure pertaining to the year alone should be charged against year’s revenue and all income whether received or not should be accrued for the year. Following this principle one has to make certain year-end adjustments in the books of account and outstanding assets are brought to book in that process. If expenditure has been made on certain revenue heads, the benefit of which is to be derived even after the year is over and adjustment is made to the original figure of expenditure so as to carry forward the sum that does not pertain to the year an outstanding asset is created. Similarly, if certain income has accrued for the year but has not been received, the amount that has so accrued is usually brought into books as year-end adjustment and thereby creating an outstanding assets account.