Accounting Concepts

Accounting concepts

Going concern — assume the business continues operating.
Accruals (matching) — record income/expenses when earned/incurred.
Consistency — same methods each period (comparability).
Prudence — don't overstate profit/assets; recognise likely losses.
Business entity — keep the owner separate from the business.
Money measurement — only record what can be measured in money.
Materiality — small items treated simply.
Historic cost — record assets at original cost.