10 MAIN

ACCOUNTING
PRINCIPLES

ABDUL QUDOOS
Certified Accountant - Bookkeeping & Accounts Payables Expert
01

ACCRUAL
Business transactions are recorded
when they occur and not when the
related payments are received or
made in other words regardless of the
actual cash flows for the transaction
received.
02

CONSISTENCY
The consistency principle states that
business should maintain the same
accounting methods or principles
throughout the accounting period with
that users of financial statements are
able to make meaningful conclusion.
03

ECONOMIC ENTITY
This accounting principle states that
states that a business entity finances
should be keep separate from those of
the owner, partners or shareholders.
04

COST
A business should only record its assets,
laibilites and investments at their orignal
purchase cost.
05

GOING CONCERN
A business will remain in operations
for the forseeable future.
06

MATERIALITTY
This principle states that all items that
are resonably likely to impact investors
decison making, must be recorded or
reported in detail in business financial
statements.
07

MATCHING
This principle states that all revenues
and any related expenses be recognized
in the same accounting period.
08

REVENUE RECOGNITION
Revenue recognition states that cpmpanies
revenues are recognized when the product
or service considered to be delivered to the
customer not when the cash is received.
09

MONETARY
Money itself is treated as a unit of
measurement and business transactions
should only be recorded if they expressed in
terms of a currency.
10

FULL DISCLOSURE
A copmany should include in or alongside its
financial statements all of the information that
may impact a readers understanding of those
statements.
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