Cash Method - The cash method of accounting may be adopted by accrual-basis taxpayers with consolidated average gross receipts of less than $10,000,000 (including tax-exempt interest income) computed over the three years preceding the year of change. Any partial tax year existing within the three-year look-back period must be annualized for the calculation.
If an accrual method bank fails the $10,000,000 test, it cannot switch to cash basis.
Accrual Method - S corporation banks on the cash method are not normally required to switch to the accrual method when their average gross receipts exceed $10,000,000.