ACCN2 - Accounting Concepts

emily-massey
Flashcards by emily-massey, updated more than 1 year ago
emily-massey
Created by emily-massey almost 7 years ago
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Flashcards on ACCN2 - Accounting Concepts, created by emily-massey on 01/27/2015.

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Question Answer
Business Entity Transactions recorded in an organisation’s accounts can only relate to that organisation.
Materiality All information in the final accounts should be significant to the users of the statements
Cost Assets should be valued at cost. Objective valuation rather than a matter of opinion
Going Concern Accountants must assume that the business will continue trading for the foreseeable future
Accurals Profits should be calculated for a period of time. Revenue must be matched with the expenses incurred in earning that revenue in that period only.
Consistency Requires a business to apply the same accounting procedures and policies from one financial period to the next.
Prudence Where there is any doubt, assets and profits should be understated rather than overstated.
Realisation Revenue should only be recognised when it is certain.
Objectivity Whenever possible accounting information should be factual rather than an opinion.
Money Measurement Concept Everything that must be measurable in cash.
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