Accounting principles

Updated: Aug 20, 2021

The principles according to which accounts are prepared. The term does not relate to the mundane processes of double-entry bookkeeping but to the concepts adopted in defining and calculating individual items of income. expenditure, assets and liabilities. Generally speaking, these concepts and processes have been agreed over the years within the accounting profession and in more recent times have been the subject of various Statements of Standard Accounting Practices (S.S. A.P.s), to which members of the major accounting bodies are expected to conform. These principles have particular reference accounts of limited companies, which ust by law be filed and distributed to memrs, but they are also intended as fairly comprehensive guidelines in the pre)aration of any sets of accounts, whether of trading organizations or non-profit-making bodies.

Reference: The Penguin Business Dictionary, 3rd edt.

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