Kinds of Accounting Principles

To distinguish accounting principles, from the sense in which the term principles is used
in physical science, various other terms like postulates, concepts, conventions, doctrines, tenets,
axioms, assumptions, etc., have been used by writers of accounting theory. Instead of wasting
our time to discuss the precise meaning of these generic terms, we should concern ourselves
with the significance and importance of these ideas in the practical work of the accountants.
However, a slight distinction is made between the two terms ‘concepts’ and ‘conventions’. The
term “Concept” is used to connote the accounting postulates, i.e., necessary assumptions and
ideas which are fundamental to accounting practice. The term “Convention” is used to signify
customs or traditions as a guide to the preparation of accounting statements.
The following are the important generally acceptable concepts.
1. Entity Concept.
2. Going Concern Concept.
3. Money Measurement Concept.
4. Cost Concept.
5. Accounting Period Concept.
6. Dual Aspect Concept.
7. Matching Concept.
8. Realisation Concept.
9. Balance Sheet Equation Concept.
10. Verification and Objective Evidence Concept.
11. Accrual Concept.