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    CF

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    NeilLaurrenceDimal

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    © All Rights Reserved
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    CF

    Uploaded by

    NeilLaurrenceDimal
    18 views2 pages

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    © All Rights Reserved
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    Download as docx, pdf, or txt
    18 views2 pages

    CF

    Uploaded by

    NeilLaurrenceDimal

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
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    going concern concept 

    is a fundamental principle of accounting. It assumes that during and


    beyond the next fiscal period a company will complete its current plans

    cost principle is one of the basic underlying guidelines in accounting. The cost


    principle requires that assets be recorded at the cash amount (or the equivalent) at the time
    that an asset is acquired.

    Faithful representation is the concept that financial statements be produced that accurately
    reflect the condition of a business. For example, if a company reports in its balance sheet that it
    had $1,200,000 of accounts receivable as of the end of June, then that amount should indeed
    have been present on that date

    Relevance: In accounting, the term relevance means it will make a difference to a


    decision maker. Relevant information is capable of making a difference in the decisions made
    by users. It is capable of making a difference in decisions if it has predictive value, confirmatory
    value , or both.  

    Substance over form is an accounting concept which means that the economic substance of
    transactions and events must be recorded in the financial statements rather than just their
    legal form in order to present a true and fair view of the affairs of the entity.

     Neutrality: Depiction is without bias in the selection or presentation of Financial


    information uust not be manipulated in any way in order to influence the decision of
    users. (fairness and freedom from bias)

    Consistency refers to the use of the same methods for the same items (Consistency of
    Treatment) either from period to period within a reporting entity or in a single period across
    entities

    conservatism principle is the general concept of recognizing expenses and liabilities as soon


    as possible when there is uncertainty about the outcome, but to only recognize revenues and
    assets when they are assured of being received

    Completeness: Depiction of all necessary information for a user to understand the


    phenomenon being depicted. It includes all necessary descriptions and explanations
     materiality principle states that an accounting standard can be ignored if the net impact of
    doing so has such a small impact on the financial statements that a user of the statements
    would not be misled.

    Verifiability helps assure that Information faithfully represents the economic phenomena it
    purports to represent. It means that different knowledgeable and observers could reach
    consensus that a particular depiction is a Faithful Representation.

    Systematic and rational allocation is a phrase often cited in the definition of depreciation. In
    that context it means that the annual depreciation expense should be based on a formula that is
    logical and acceptable to other unbiased accountants.

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