Selection of Accounting Principles: 4 Considerations

The following points highlight the four main considerations which guide the selection of accounting principles. The considerations are: 1. Accurate Presentation 2. Conservatism 3. Profit Maximization 4. Income Smoothing. Consideration # 1. Accurate Presentation: One of the criteria for assessing the usefulness of accounting information is accuracy in presentation of the underlying events and transactions. This criterion may be used [...]