Financial Statement to Bank

Well, actually, you cannot incur that bill until it has been paid. If he hasn't put out any money for it, then it should not have to be reported. I do not feel it is unethical. It should be ok. If he with-held the actual bill, that would be different. As long as he can fulfill his bank obligation it is fine too!

As we are already aware about one of the concept of accounts i.e. prudence concept, which explains that all the expenses and losses which are to be held in near future should be recognized in advance and the income or profits in future shouldn't be recognized until it is realized. In this present case, since the client is following accrual basis, hence the financial statement should mention about the expense made for computer repair though the book does not show the expense held for the said purpose. Because, expenses are to be anticipated once incurred and hence it is immaterial that the bill is received or not.

its depending on the basis he based on whether its monetary or accrual basis