0Just like we have Grammar in English Language, which is basically the rules of English, we have some rules for Accounting as well, known as Accounting Principles.
Accounting Principles, Concepts and Conventions commonly known as Generally Accepted Accounting Principles or GAAPs are the basic rules that define the parameters and constraints within which Accounting operates. These principles are the theory base of accounting, on the basis of which financial statements are prepared. In other words, they are the guidelines for preparing the financial statements.
Accounting Principles are classified into two categories:
- Accounting Concepts
- Accounting Conventions
