ACCOUNTING: GAAP
The following is an outline for accounting, stating guidelines for acceptable accounting, and removing all bias or inconsistencies.Principle of Consistency/Regularity: Forces accountants to conform to enforced rules and regulations.
Principle of Sincerity: Forces the accounting unit to truthfully state accurate numbers for the company’s financial status.
Principle of Permanence of Method: Forces the accounting unit to keep consistency on how they track numbers to ensure accurate comparison.
Principle of non-compensation: Forces one to show complete details on financial information such as not compensating a debt with an asset, etc.
Principle of Prudence: Forces an accounting unit to truthfully show all information as is, and not cover up reality by making the numbers look better.
Principle of Continuity: In accounting, numbers should be uninterrupted, and should be assumed as such.
Principle of periodicity: Accounting should be done in time periods, such as annually, quarterly, etc. This principle enforces that the given time periods remain the same.
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