Introduction To Accounting: Part 8: Accounting Concepts

In order to make the accounting language convey the same meaning to all people and to make it more meaningful, most of the accountants have agreed on a number of concepts which are usually followed for preparing the Financial Statements. These concepts provide a foundation for Accounting Process. No enterprise can prepare its financial statements without considering these basic concepts or assumptions. These concepts guide how transactions should be recorded and reported.

Following are the Accounting Concepts:

1. Going Concern Concept
2. Consistency Concept
3. Accrual Concept
4. Business Entity Concept
5. Money Measurement Concept
6. Accounting Period Concept
7. Cost Concept or Historical Cost Concept
8. Matching Concept
9. Dual Aspect Concept
10. Revenue Recognition Concept or Realisation Concept
11. Verifiable Objective Concept