SlideShare a Scribd company logo
DEVTECH FINANCE
ACCOUNTING
CONCEPTS &
CONVENTIONS
SEPARATE ENTITY CONCEPT
GOING CONCERN CONCEPT
MONEY MEASUREMENT
CONCEPT
COST CONCEPT
DUAL ASPECT CONCEPT
ACCOUNTING PERIOD CONCEPT
MATCHING CONCEPT
ACCOUNTING CONCEPTS
SEPARATE ENTITY CONCEPT
GOING CONCERN CONCEPT
MONEY MEASUREMENT CONCEPT
COST CONCEPT
DUAL ASPECT CONCEPT
ACCOUNTING PERIOD CONCEPT
MATCHING CONCEPT
ACCOUNTING CONCEPTS
1. SEPARATE ENTITY CONCEPT – According to this concept, business
is considered as a separate legal entity which has its distinct identity
separate from its owner. This concept is extremely useful in keeping
business affairs strictly free from private affairs of owner. This is the
reason why withdrawal by owner from business is treated as drawing.
2. GOING CONCERN CONCEPT – According to this concept, it is
assumed that business is established and will continue for a fairly long
time in future. This is the reason why while valuing assets of firm current
resale value is not taken into account instead depreciation is charge on
basis of their expected life.
ACCOUNTING CONCEPTS
3. MONEY MEASUREMENT CONCEPT – According to this concept,
accounting should necessarily record only those transactions which can
be expressed in monetary terms. This is the reason why qualitative facts
like change in management are not recorded in books of account.
4. COST CONCEPT – This concept is closely related to going concern
concept and emphasizes that asset should be recorded at its cost price
and not market price which keeps on changing.
ACCOUNTING CONCEPTS
5. DUAL ASPECT CONCEPT – The dual aspect concept states that
every business transaction requires recordation in two different accounts.
The concept is derived from the accounting equation, which states that:
Assets = Liabilities + Equity .The accounting equation is made visible in
the balance sheet, where the total amount of assets listed must equal the
total of all liabilities and equity.
For e.g. Borrowed 10,000 rupee from Mr. XYZ . Now, as a result of this
transaction asset side in form of cash or bank will increase by 10,000
hence debit and at the same time liability will also increase by 10,000 in
form of creditor to be paid back hence credit.
ACCOUNTING CONCEPTS
6. ACCOUNTING PERIOD CONCEPT – According to this concept,
accounting should measure transactions at regular intervals for a
specified period of time called accounting period. Necessary financial
disclosures and reporting need to be made at the end of accounting
period which may be quarterly, half-yearly or yearly.
7. MATCHING CONCEPT – This concept is also known as periodic
matching of cost and revenue. According to this concept, profits made by
business in particular accounting period can be ascertained only when the
revenues earned during the period are compared with the expenses
incurred in earning the revenue.
ACCOUNTING CONVENTIONS
1. CONSERVATISM
2. FULL DISCLOSURE
3. CONSISTENCY
4. MATERIALITY
MATERIALITY CONSERVATISM
CONSISTENCY FULL DISCLOSURE
ACCOUNTING CONVENTIONS
1. CONVENTION OF CONSERVATISM – According to this convention,
the accountants have to follow the rule, anticipate no profit, provide for all
possible losses while recording business transactions to meet uncertainty
efficiently. It is because of this convention that provision for bad and
doubtful debts are created.
2. CONVENTION OF FULL DISCLOSURE – According to this
convention, there should be adequate disclosure of all material
information in the financial statements prepared for stakeholders like
investors, creditors, government etc.
ACCOUNTING CONVENTIONS
3. CONVENTION OF CONSISTENCY – According to this convention, it is
essential that accounting procedures and method should remain
unchanged from one accounting period to another to facilitate
comparison. For e.g. if material issued are priced on basis of fifo method
the same should be followed thereafter.
4. CONVENTION OF MATERIALITY – According to this convention, the
accountants should attach importance to material details and ignore
insignificant ones. In the absence of this distinction accounting will
unnecessary be complex and burdened with minute details. For e.g.
increase in competition, change in demand pattern etc.
THANK YOU FOR WATCHING
DEVTECH
FINANCE

More Related Content

What's hot

What is profit , types of profit, theories of profit
What is profit , types of profit, theories of profitWhat is profit , types of profit, theories of profit
What is profit , types of profit, theories of profit
arvind saini
 
Trial balance ppt
Trial balance pptTrial balance ppt
Trial balance ppt
harshika5
 
ABC costing
ABC costing ABC costing
ABC costing
Dr. Sushil Bansode
 
Types of leverages
Types of leveragesTypes of leverages
Types of leverages
Aswathy_Jayan
 
Basics of accounting
Basics of accountingBasics of accounting
Basics of accounting
Aditya K
 
Nature & scope of finance function.pptx
Nature & scope of finance function.pptxNature & scope of finance function.pptx
Nature & scope of finance function.pptx
FashionHub12
 
Topic 3 Double entry book keeping
Topic 3 Double entry book keepingTopic 3 Double entry book keeping
Topic 3 Double entry book keeping
Srinivas Methuku
 
Accounting standards
Accounting standardsAccounting standards
Accounting standards
prashantoswal
 
Managerial Economics- Introduction,Characteristics and Scope
Managerial Economics- Introduction,Characteristics and ScopeManagerial Economics- Introduction,Characteristics and Scope
Managerial Economics- Introduction,Characteristics and Scope
Pooja Kadiyan
 
Joint product and by product costing
Joint product and by product costingJoint product and by product costing
Joint product and by product costing
Muhammad Usman
 
Accounting for depreciation 1
Accounting for depreciation 1Accounting for depreciation 1
Accounting for depreciation 1
Mahesh Chandra Sharma
 
Managerial economics introduction
Managerial economics introductionManagerial economics introduction
Managerial economics introduction
Shompa Nandi
 
Rationale for harmonization of financial reporting practice around the world.
Rationale for harmonization of financial reporting practice around the world.Rationale for harmonization of financial reporting practice around the world.
Rationale for harmonization of financial reporting practice around the world.
Sundar B N
 
Accounting concepts
Accounting conceptsAccounting concepts
Accounting concepts
Satyanath Mohapatra
 
Introduction International Accounting
Introduction International AccountingIntroduction International Accounting
Introduction International Accounting
Sundar B N
 
Accounting principles
Accounting principlesAccounting principles
Accounting principles
Mahesh Chandra Sharma
 
Price determinants of various market structures
Price determinants of various market structuresPrice determinants of various market structures
Price determinants of various market structures
Dr Naim R Kidwai
 
Return to scale
Return to scaleReturn to scale
Return to scale
Lokesh Parihar
 
Accounting standards and IFRS
Accounting standards and IFRSAccounting standards and IFRS
Accounting standards and IFRS
Sushovit Rout
 
Computerized accounting
Computerized accountingComputerized accounting
Computerized accounting
Dr. Sushil Bansode
 

What's hot (20)

What is profit , types of profit, theories of profit
What is profit , types of profit, theories of profitWhat is profit , types of profit, theories of profit
What is profit , types of profit, theories of profit
 
Trial balance ppt
Trial balance pptTrial balance ppt
Trial balance ppt
 
ABC costing
ABC costing ABC costing
ABC costing
 
Types of leverages
Types of leveragesTypes of leverages
Types of leverages
 
Basics of accounting
Basics of accountingBasics of accounting
Basics of accounting
 
Nature & scope of finance function.pptx
Nature & scope of finance function.pptxNature & scope of finance function.pptx
Nature & scope of finance function.pptx
 
Topic 3 Double entry book keeping
Topic 3 Double entry book keepingTopic 3 Double entry book keeping
Topic 3 Double entry book keeping
 
Accounting standards
Accounting standardsAccounting standards
Accounting standards
 
Managerial Economics- Introduction,Characteristics and Scope
Managerial Economics- Introduction,Characteristics and ScopeManagerial Economics- Introduction,Characteristics and Scope
Managerial Economics- Introduction,Characteristics and Scope
 
Joint product and by product costing
Joint product and by product costingJoint product and by product costing
Joint product and by product costing
 
Accounting for depreciation 1
Accounting for depreciation 1Accounting for depreciation 1
Accounting for depreciation 1
 
Managerial economics introduction
Managerial economics introductionManagerial economics introduction
Managerial economics introduction
 
Rationale for harmonization of financial reporting practice around the world.
Rationale for harmonization of financial reporting practice around the world.Rationale for harmonization of financial reporting practice around the world.
Rationale for harmonization of financial reporting practice around the world.
 
Accounting concepts
Accounting conceptsAccounting concepts
Accounting concepts
 
Introduction International Accounting
Introduction International AccountingIntroduction International Accounting
Introduction International Accounting
 
Accounting principles
Accounting principlesAccounting principles
Accounting principles
 
Price determinants of various market structures
Price determinants of various market structuresPrice determinants of various market structures
Price determinants of various market structures
 
Return to scale
Return to scaleReturn to scale
Return to scale
 
Accounting standards and IFRS
Accounting standards and IFRSAccounting standards and IFRS
Accounting standards and IFRS
 
Computerized accounting
Computerized accountingComputerized accounting
Computerized accounting
 

Similar to Accounting Concepts & Conventions

Accountingconceptsconventions
AccountingconceptsconventionsAccountingconceptsconventions
Accountingconceptsconventions
gunjan_dhingra
 
accountingconceptsconventions-091002014324-phpapp02.ppt
accountingconceptsconventions-091002014324-phpapp02.pptaccountingconceptsconventions-091002014324-phpapp02.ppt
accountingconceptsconventions-091002014324-phpapp02.ppt
Manjulagupta15
 
Accoutning concepts, principles and conventions
Accoutning concepts, principles and conventionsAccoutning concepts, principles and conventions
Accoutning concepts, principles and conventions
gherryta
 
Accounting Principles- Concepts & Conventions
Accounting Principles- Concepts & ConventionsAccounting Principles- Concepts & Conventions
Accounting Principles- Concepts & Conventions
seemamahajan11
 
Accounting Fundamentals - Concepts and Convetions
Accounting Fundamentals - Concepts and ConvetionsAccounting Fundamentals - Concepts and Convetions
Presentation1
Presentation1Presentation1
Presentation1
CHANDRAKANTH S V
 
Accounting principles , conventions and concepts
Accounting principles , conventions and conceptsAccounting principles , conventions and concepts
Accounting principles , conventions and concepts
Sanjeet Yadav
 
2. concepts and conventions of accounting mba 1st tri semester
2. concepts and conventions of accounting mba 1st tri semester2. concepts and conventions of accounting mba 1st tri semester
2. concepts and conventions of accounting mba 1st tri semester
Karan Kukreja
 
Accountingconceptsconventions 091002014324-phpapp02
Accountingconceptsconventions 091002014324-phpapp02Accountingconceptsconventions 091002014324-phpapp02
Accountingconceptsconventions 091002014324-phpapp02
Mohan Khamkar
 
Acc prin.ppt
Acc prin.pptAcc prin.ppt
Acc prin.ppt
DrShishmaKushwaha
 
Financial accounting concepts
Financial accounting conceptsFinancial accounting concepts
Financial accounting concepts
Gagandeep Kaur
 
accounting principles day 1 for accounts.pptx
accounting principles day 1 for accounts.pptxaccounting principles day 1 for accounts.pptx
accounting principles day 1 for accounts.pptx
chotu6216
 
accountingprinciples-170804072746.pdf
accountingprinciples-170804072746.pdfaccountingprinciples-170804072746.pdf
accountingprinciples-170804072746.pdf
AnwarIndris
 
Acc princ
Acc princAcc princ
Acc princ
07Deeps
 
Accounting Concepts and Principles
Accounting Concepts and PrinciplesAccounting Concepts and Principles
Accounting Concepts and Principles
ariftokymc
 
| Generally Accepted Accounting Principles | Principles of Accounting | Accou...
| Generally Accepted Accounting Principles | Principles of Accounting | Accou...| Generally Accepted Accounting Principles | Principles of Accounting | Accou...
| Generally Accepted Accounting Principles | Principles of Accounting | Accou...
Ahmad Hassan
 
(MBA SEM 1) SEM 1 Accounting Principles.pptx
(MBA SEM 1) SEM 1 Accounting Principles.pptx(MBA SEM 1) SEM 1 Accounting Principles.pptx
(MBA SEM 1) SEM 1 Accounting Principles.pptx
gindu3009
 
Accounting concepts and convention
Accounting concepts and conventionAccounting concepts and convention
Accounting concepts and convention
rahul kapoliya
 
Accounting Concepts and Conventions.pdf.
Accounting Concepts and Conventions.pdf.Accounting Concepts and Conventions.pdf.
Accounting Concepts and Conventions.pdf.
chalotrav5
 
Gaap concepts and importance of accounting
Gaap concepts and importance of accountingGaap concepts and importance of accounting
Gaap concepts and importance of accounting
Ishita Shah
 

Similar to Accounting Concepts & Conventions (20)

Accountingconceptsconventions
AccountingconceptsconventionsAccountingconceptsconventions
Accountingconceptsconventions
 
accountingconceptsconventions-091002014324-phpapp02.ppt
accountingconceptsconventions-091002014324-phpapp02.pptaccountingconceptsconventions-091002014324-phpapp02.ppt
accountingconceptsconventions-091002014324-phpapp02.ppt
 
Accoutning concepts, principles and conventions
Accoutning concepts, principles and conventionsAccoutning concepts, principles and conventions
Accoutning concepts, principles and conventions
 
Accounting Principles- Concepts & Conventions
Accounting Principles- Concepts & ConventionsAccounting Principles- Concepts & Conventions
Accounting Principles- Concepts & Conventions
 
Accounting Fundamentals - Concepts and Convetions
Accounting Fundamentals - Concepts and ConvetionsAccounting Fundamentals - Concepts and Convetions
Accounting Fundamentals - Concepts and Convetions
 
Presentation1
Presentation1Presentation1
Presentation1
 
Accounting principles , conventions and concepts
Accounting principles , conventions and conceptsAccounting principles , conventions and concepts
Accounting principles , conventions and concepts
 
2. concepts and conventions of accounting mba 1st tri semester
2. concepts and conventions of accounting mba 1st tri semester2. concepts and conventions of accounting mba 1st tri semester
2. concepts and conventions of accounting mba 1st tri semester
 
Accountingconceptsconventions 091002014324-phpapp02
Accountingconceptsconventions 091002014324-phpapp02Accountingconceptsconventions 091002014324-phpapp02
Accountingconceptsconventions 091002014324-phpapp02
 
Acc prin.ppt
Acc prin.pptAcc prin.ppt
Acc prin.ppt
 
Financial accounting concepts
Financial accounting conceptsFinancial accounting concepts
Financial accounting concepts
 
accounting principles day 1 for accounts.pptx
accounting principles day 1 for accounts.pptxaccounting principles day 1 for accounts.pptx
accounting principles day 1 for accounts.pptx
 
accountingprinciples-170804072746.pdf
accountingprinciples-170804072746.pdfaccountingprinciples-170804072746.pdf
accountingprinciples-170804072746.pdf
 
Acc princ
Acc princAcc princ
Acc princ
 
Accounting Concepts and Principles
Accounting Concepts and PrinciplesAccounting Concepts and Principles
Accounting Concepts and Principles
 
| Generally Accepted Accounting Principles | Principles of Accounting | Accou...
| Generally Accepted Accounting Principles | Principles of Accounting | Accou...| Generally Accepted Accounting Principles | Principles of Accounting | Accou...
| Generally Accepted Accounting Principles | Principles of Accounting | Accou...
 
(MBA SEM 1) SEM 1 Accounting Principles.pptx
(MBA SEM 1) SEM 1 Accounting Principles.pptx(MBA SEM 1) SEM 1 Accounting Principles.pptx
(MBA SEM 1) SEM 1 Accounting Principles.pptx
 
Accounting concepts and convention
Accounting concepts and conventionAccounting concepts and convention
Accounting concepts and convention
 
Accounting Concepts and Conventions.pdf.
Accounting Concepts and Conventions.pdf.Accounting Concepts and Conventions.pdf.
Accounting Concepts and Conventions.pdf.
 
Gaap concepts and importance of accounting
Gaap concepts and importance of accountingGaap concepts and importance of accounting
Gaap concepts and importance of accounting
 

More from DevTech Finance

Bitcoin - The CryptoCurrency
Bitcoin - The CryptoCurrencyBitcoin - The CryptoCurrency
Bitcoin - The CryptoCurrency
DevTech Finance
 
Cash Management
Cash ManagementCash Management
Cash Management
DevTech Finance
 
Portfolio Management
Portfolio ManagementPortfolio Management
Portfolio Management
DevTech Finance
 
No Cost EMI - 0% Interest Loan
No Cost EMI - 0% Interest LoanNo Cost EMI - 0% Interest Loan
No Cost EMI - 0% Interest Loan
DevTech Finance
 
Health Insurance
Health InsuranceHealth Insurance
Health Insurance
DevTech Finance
 
Face Value, Book Value & Market Value
Face Value, Book Value & Market ValueFace Value, Book Value & Market Value
Face Value, Book Value & Market Value
DevTech Finance
 
Loan Moratorium Period.
Loan Moratorium Period.Loan Moratorium Period.
Loan Moratorium Period.
DevTech Finance
 
Hire Purchase
Hire PurchaseHire Purchase
Hire Purchase
DevTech Finance
 
Infrastructure Financing
Infrastructure FinancingInfrastructure Financing
Infrastructure Financing
DevTech Finance
 
Recovery Management In Banking
Recovery Management In BankingRecovery Management In Banking
Recovery Management In Banking
DevTech Finance
 
Board of Directors
Board of DirectorsBoard of Directors
Board of Directors
DevTech Finance
 
Inventory Management
Inventory ManagementInventory Management
Inventory Management
DevTech Finance
 
Money Market
Money MarketMoney Market
Money Market
DevTech Finance
 
Consortium Finance
Consortium FinanceConsortium Finance
Consortium Finance
DevTech Finance
 
Indian Banking System
Indian Banking SystemIndian Banking System
Indian Banking System
DevTech Finance
 
CRM Models
CRM ModelsCRM Models
CRM Models
DevTech Finance
 
NBFC
NBFCNBFC
NPCI
NPCINPCI
Credit Monitoring
Credit MonitoringCredit Monitoring
Credit Monitoring
DevTech Finance
 
Stewardship theory
Stewardship theoryStewardship theory
Stewardship theory
DevTech Finance
 

More from DevTech Finance (20)

Bitcoin - The CryptoCurrency
Bitcoin - The CryptoCurrencyBitcoin - The CryptoCurrency
Bitcoin - The CryptoCurrency
 
Cash Management
Cash ManagementCash Management
Cash Management
 
Portfolio Management
Portfolio ManagementPortfolio Management
Portfolio Management
 
No Cost EMI - 0% Interest Loan
No Cost EMI - 0% Interest LoanNo Cost EMI - 0% Interest Loan
No Cost EMI - 0% Interest Loan
 
Health Insurance
Health InsuranceHealth Insurance
Health Insurance
 
Face Value, Book Value & Market Value
Face Value, Book Value & Market ValueFace Value, Book Value & Market Value
Face Value, Book Value & Market Value
 
Loan Moratorium Period.
Loan Moratorium Period.Loan Moratorium Period.
Loan Moratorium Period.
 
Hire Purchase
Hire PurchaseHire Purchase
Hire Purchase
 
Infrastructure Financing
Infrastructure FinancingInfrastructure Financing
Infrastructure Financing
 
Recovery Management In Banking
Recovery Management In BankingRecovery Management In Banking
Recovery Management In Banking
 
Board of Directors
Board of DirectorsBoard of Directors
Board of Directors
 
Inventory Management
Inventory ManagementInventory Management
Inventory Management
 
Money Market
Money MarketMoney Market
Money Market
 
Consortium Finance
Consortium FinanceConsortium Finance
Consortium Finance
 
Indian Banking System
Indian Banking SystemIndian Banking System
Indian Banking System
 
CRM Models
CRM ModelsCRM Models
CRM Models
 
NBFC
NBFCNBFC
NBFC
 
NPCI
NPCINPCI
NPCI
 
Credit Monitoring
Credit MonitoringCredit Monitoring
Credit Monitoring
 
Stewardship theory
Stewardship theoryStewardship theory
Stewardship theory
 

Recently uploaded

writing about opinions about Australia the movie
writing about opinions about Australia the moviewriting about opinions about Australia the movie
writing about opinions about Australia the movie
Nicholas Montgomery
 
RHEOLOGY Physical pharmaceutics-II notes for B.pharm 4th sem students
RHEOLOGY Physical pharmaceutics-II notes for B.pharm 4th sem studentsRHEOLOGY Physical pharmaceutics-II notes for B.pharm 4th sem students
RHEOLOGY Physical pharmaceutics-II notes for B.pharm 4th sem students
Himanshu Rai
 
Film vocab for eal 3 students: Australia the movie
Film vocab for eal 3 students: Australia the movieFilm vocab for eal 3 students: Australia the movie
Film vocab for eal 3 students: Australia the movie
Nicholas Montgomery
 
BBR 2024 Summer Sessions Interview Training
BBR  2024 Summer Sessions Interview TrainingBBR  2024 Summer Sessions Interview Training
BBR 2024 Summer Sessions Interview Training
Katrina Pritchard
 
Reimagining Your Library Space: How to Increase the Vibes in Your Library No ...
Reimagining Your Library Space: How to Increase the Vibes in Your Library No ...Reimagining Your Library Space: How to Increase the Vibes in Your Library No ...
Reimagining Your Library Space: How to Increase the Vibes in Your Library No ...
Diana Rendina
 
Your Skill Boost Masterclass: Strategies for Effective Upskilling
Your Skill Boost Masterclass: Strategies for Effective UpskillingYour Skill Boost Masterclass: Strategies for Effective Upskilling
Your Skill Boost Masterclass: Strategies for Effective Upskilling
Excellence Foundation for South Sudan
 
বাংলাদেশ অর্থনৈতিক সমীক্ষা (Economic Review) ২০২৪ UJS App.pdf
বাংলাদেশ অর্থনৈতিক সমীক্ষা (Economic Review) ২০২৪ UJS App.pdfবাংলাদেশ অর্থনৈতিক সমীক্ষা (Economic Review) ২০২৪ UJS App.pdf
বাংলাদেশ অর্থনৈতিক সমীক্ষা (Economic Review) ২০২৪ UJS App.pdf
eBook.com.bd (প্রয়োজনীয় বাংলা বই)
 
Wound healing PPT
Wound healing PPTWound healing PPT
Wound healing PPT
Jyoti Chand
 
How to Setup Warehouse & Location in Odoo 17 Inventory
How to Setup Warehouse & Location in Odoo 17 InventoryHow to Setup Warehouse & Location in Odoo 17 Inventory
How to Setup Warehouse & Location in Odoo 17 Inventory
Celine George
 
How to deliver Powerpoint Presentations.pptx
How to deliver Powerpoint  Presentations.pptxHow to deliver Powerpoint  Presentations.pptx
How to deliver Powerpoint Presentations.pptx
HajraNaeem15
 
LAND USE LAND COVER AND NDVI OF MIRZAPUR DISTRICT, UP
LAND USE LAND COVER AND NDVI OF MIRZAPUR DISTRICT, UPLAND USE LAND COVER AND NDVI OF MIRZAPUR DISTRICT, UP
LAND USE LAND COVER AND NDVI OF MIRZAPUR DISTRICT, UP
RAHUL
 
Liberal Approach to the Study of Indian Politics.pdf
Liberal Approach to the Study of Indian Politics.pdfLiberal Approach to the Study of Indian Politics.pdf
Liberal Approach to the Study of Indian Politics.pdf
WaniBasim
 
PIMS Job Advertisement 2024.pdf Islamabad
PIMS Job Advertisement 2024.pdf IslamabadPIMS Job Advertisement 2024.pdf Islamabad
PIMS Job Advertisement 2024.pdf Islamabad
AyyanKhan40
 
spot a liar (Haiqa 146).pptx Technical writhing and presentation skills
spot a liar (Haiqa 146).pptx Technical writhing and presentation skillsspot a liar (Haiqa 146).pptx Technical writhing and presentation skills
spot a liar (Haiqa 146).pptx Technical writhing and presentation skills
haiqairshad
 
Cognitive Development Adolescence Psychology
Cognitive Development Adolescence PsychologyCognitive Development Adolescence Psychology
Cognitive Development Adolescence Psychology
paigestewart1632
 
Beyond Degrees - Empowering the Workforce in the Context of Skills-First.pptx
Beyond Degrees - Empowering the Workforce in the Context of Skills-First.pptxBeyond Degrees - Empowering the Workforce in the Context of Skills-First.pptx
Beyond Degrees - Empowering the Workforce in the Context of Skills-First.pptx
EduSkills OECD
 
UGC NET Exam Paper 1- Unit 1:Teaching Aptitude
UGC NET Exam Paper 1- Unit 1:Teaching AptitudeUGC NET Exam Paper 1- Unit 1:Teaching Aptitude
UGC NET Exam Paper 1- Unit 1:Teaching Aptitude
S. Raj Kumar
 
Digital Artefact 1 - Tiny Home Environmental Design
Digital Artefact 1 - Tiny Home Environmental DesignDigital Artefact 1 - Tiny Home Environmental Design
Digital Artefact 1 - Tiny Home Environmental Design
amberjdewit93
 
South African Journal of Science: Writing with integrity workshop (2024)
South African Journal of Science: Writing with integrity workshop (2024)South African Journal of Science: Writing with integrity workshop (2024)
South African Journal of Science: Writing with integrity workshop (2024)
Academy of Science of South Africa
 
Présentationvvvvvvvvvvvvvvvvvvvvvvvvvvvv2.pptx
Présentationvvvvvvvvvvvvvvvvvvvvvvvvvvvv2.pptxPrésentationvvvvvvvvvvvvvvvvvvvvvvvvvvvv2.pptx
Présentationvvvvvvvvvvvvvvvvvvvvvvvvvvvv2.pptx
siemaillard
 

Recently uploaded (20)

writing about opinions about Australia the movie
writing about opinions about Australia the moviewriting about opinions about Australia the movie
writing about opinions about Australia the movie
 
RHEOLOGY Physical pharmaceutics-II notes for B.pharm 4th sem students
RHEOLOGY Physical pharmaceutics-II notes for B.pharm 4th sem studentsRHEOLOGY Physical pharmaceutics-II notes for B.pharm 4th sem students
RHEOLOGY Physical pharmaceutics-II notes for B.pharm 4th sem students
 
Film vocab for eal 3 students: Australia the movie
Film vocab for eal 3 students: Australia the movieFilm vocab for eal 3 students: Australia the movie
Film vocab for eal 3 students: Australia the movie
 
BBR 2024 Summer Sessions Interview Training
BBR  2024 Summer Sessions Interview TrainingBBR  2024 Summer Sessions Interview Training
BBR 2024 Summer Sessions Interview Training
 
Reimagining Your Library Space: How to Increase the Vibes in Your Library No ...
Reimagining Your Library Space: How to Increase the Vibes in Your Library No ...Reimagining Your Library Space: How to Increase the Vibes in Your Library No ...
Reimagining Your Library Space: How to Increase the Vibes in Your Library No ...
 
Your Skill Boost Masterclass: Strategies for Effective Upskilling
Your Skill Boost Masterclass: Strategies for Effective UpskillingYour Skill Boost Masterclass: Strategies for Effective Upskilling
Your Skill Boost Masterclass: Strategies for Effective Upskilling
 
বাংলাদেশ অর্থনৈতিক সমীক্ষা (Economic Review) ২০২৪ UJS App.pdf
বাংলাদেশ অর্থনৈতিক সমীক্ষা (Economic Review) ২০২৪ UJS App.pdfবাংলাদেশ অর্থনৈতিক সমীক্ষা (Economic Review) ২০২৪ UJS App.pdf
বাংলাদেশ অর্থনৈতিক সমীক্ষা (Economic Review) ২০২৪ UJS App.pdf
 
Wound healing PPT
Wound healing PPTWound healing PPT
Wound healing PPT
 
How to Setup Warehouse & Location in Odoo 17 Inventory
How to Setup Warehouse & Location in Odoo 17 InventoryHow to Setup Warehouse & Location in Odoo 17 Inventory
How to Setup Warehouse & Location in Odoo 17 Inventory
 
How to deliver Powerpoint Presentations.pptx
How to deliver Powerpoint  Presentations.pptxHow to deliver Powerpoint  Presentations.pptx
How to deliver Powerpoint Presentations.pptx
 
LAND USE LAND COVER AND NDVI OF MIRZAPUR DISTRICT, UP
LAND USE LAND COVER AND NDVI OF MIRZAPUR DISTRICT, UPLAND USE LAND COVER AND NDVI OF MIRZAPUR DISTRICT, UP
LAND USE LAND COVER AND NDVI OF MIRZAPUR DISTRICT, UP
 
Liberal Approach to the Study of Indian Politics.pdf
Liberal Approach to the Study of Indian Politics.pdfLiberal Approach to the Study of Indian Politics.pdf
Liberal Approach to the Study of Indian Politics.pdf
 
PIMS Job Advertisement 2024.pdf Islamabad
PIMS Job Advertisement 2024.pdf IslamabadPIMS Job Advertisement 2024.pdf Islamabad
PIMS Job Advertisement 2024.pdf Islamabad
 
spot a liar (Haiqa 146).pptx Technical writhing and presentation skills
spot a liar (Haiqa 146).pptx Technical writhing and presentation skillsspot a liar (Haiqa 146).pptx Technical writhing and presentation skills
spot a liar (Haiqa 146).pptx Technical writhing and presentation skills
 
Cognitive Development Adolescence Psychology
Cognitive Development Adolescence PsychologyCognitive Development Adolescence Psychology
Cognitive Development Adolescence Psychology
 
Beyond Degrees - Empowering the Workforce in the Context of Skills-First.pptx
Beyond Degrees - Empowering the Workforce in the Context of Skills-First.pptxBeyond Degrees - Empowering the Workforce in the Context of Skills-First.pptx
Beyond Degrees - Empowering the Workforce in the Context of Skills-First.pptx
 
UGC NET Exam Paper 1- Unit 1:Teaching Aptitude
UGC NET Exam Paper 1- Unit 1:Teaching AptitudeUGC NET Exam Paper 1- Unit 1:Teaching Aptitude
UGC NET Exam Paper 1- Unit 1:Teaching Aptitude
 
Digital Artefact 1 - Tiny Home Environmental Design
Digital Artefact 1 - Tiny Home Environmental DesignDigital Artefact 1 - Tiny Home Environmental Design
Digital Artefact 1 - Tiny Home Environmental Design
 
South African Journal of Science: Writing with integrity workshop (2024)
South African Journal of Science: Writing with integrity workshop (2024)South African Journal of Science: Writing with integrity workshop (2024)
South African Journal of Science: Writing with integrity workshop (2024)
 
Présentationvvvvvvvvvvvvvvvvvvvvvvvvvvvv2.pptx
Présentationvvvvvvvvvvvvvvvvvvvvvvvvvvvv2.pptxPrésentationvvvvvvvvvvvvvvvvvvvvvvvvvvvv2.pptx
Présentationvvvvvvvvvvvvvvvvvvvvvvvvvvvv2.pptx
 

Accounting Concepts & Conventions

  • 1. DEVTECH FINANCE ACCOUNTING CONCEPTS & CONVENTIONS SEPARATE ENTITY CONCEPT GOING CONCERN CONCEPT MONEY MEASUREMENT CONCEPT COST CONCEPT DUAL ASPECT CONCEPT ACCOUNTING PERIOD CONCEPT MATCHING CONCEPT
  • 2. ACCOUNTING CONCEPTS SEPARATE ENTITY CONCEPT GOING CONCERN CONCEPT MONEY MEASUREMENT CONCEPT COST CONCEPT DUAL ASPECT CONCEPT ACCOUNTING PERIOD CONCEPT MATCHING CONCEPT
  • 3. ACCOUNTING CONCEPTS 1. SEPARATE ENTITY CONCEPT – According to this concept, business is considered as a separate legal entity which has its distinct identity separate from its owner. This concept is extremely useful in keeping business affairs strictly free from private affairs of owner. This is the reason why withdrawal by owner from business is treated as drawing. 2. GOING CONCERN CONCEPT – According to this concept, it is assumed that business is established and will continue for a fairly long time in future. This is the reason why while valuing assets of firm current resale value is not taken into account instead depreciation is charge on basis of their expected life.
  • 4. ACCOUNTING CONCEPTS 3. MONEY MEASUREMENT CONCEPT – According to this concept, accounting should necessarily record only those transactions which can be expressed in monetary terms. This is the reason why qualitative facts like change in management are not recorded in books of account. 4. COST CONCEPT – This concept is closely related to going concern concept and emphasizes that asset should be recorded at its cost price and not market price which keeps on changing.
  • 5. ACCOUNTING CONCEPTS 5. DUAL ASPECT CONCEPT – The dual aspect concept states that every business transaction requires recordation in two different accounts. The concept is derived from the accounting equation, which states that: Assets = Liabilities + Equity .The accounting equation is made visible in the balance sheet, where the total amount of assets listed must equal the total of all liabilities and equity. For e.g. Borrowed 10,000 rupee from Mr. XYZ . Now, as a result of this transaction asset side in form of cash or bank will increase by 10,000 hence debit and at the same time liability will also increase by 10,000 in form of creditor to be paid back hence credit.
  • 6. ACCOUNTING CONCEPTS 6. ACCOUNTING PERIOD CONCEPT – According to this concept, accounting should measure transactions at regular intervals for a specified period of time called accounting period. Necessary financial disclosures and reporting need to be made at the end of accounting period which may be quarterly, half-yearly or yearly. 7. MATCHING CONCEPT – This concept is also known as periodic matching of cost and revenue. According to this concept, profits made by business in particular accounting period can be ascertained only when the revenues earned during the period are compared with the expenses incurred in earning the revenue.
  • 7. ACCOUNTING CONVENTIONS 1. CONSERVATISM 2. FULL DISCLOSURE 3. CONSISTENCY 4. MATERIALITY MATERIALITY CONSERVATISM CONSISTENCY FULL DISCLOSURE
  • 8. ACCOUNTING CONVENTIONS 1. CONVENTION OF CONSERVATISM – According to this convention, the accountants have to follow the rule, anticipate no profit, provide for all possible losses while recording business transactions to meet uncertainty efficiently. It is because of this convention that provision for bad and doubtful debts are created. 2. CONVENTION OF FULL DISCLOSURE – According to this convention, there should be adequate disclosure of all material information in the financial statements prepared for stakeholders like investors, creditors, government etc.
  • 9. ACCOUNTING CONVENTIONS 3. CONVENTION OF CONSISTENCY – According to this convention, it is essential that accounting procedures and method should remain unchanged from one accounting period to another to facilitate comparison. For e.g. if material issued are priced on basis of fifo method the same should be followed thereafter. 4. CONVENTION OF MATERIALITY – According to this convention, the accountants should attach importance to material details and ignore insignificant ones. In the absence of this distinction accounting will unnecessary be complex and burdened with minute details. For e.g. increase in competition, change in demand pattern etc.
  • 10. THANK YOU FOR WATCHING DEVTECH FINANCE