Compare between accounting concepts and accounting convections.

The major differences between accounting concepts and accounting convections are as follows −

Accounting concepts

• These are rules that should be followed while recording transactions and preparing final accounts.

• It’s a theoretical notion.

• These rules are set by accounting bodies.

• Its main concern is the maintenance of accounts.

• Biasness is not possible here.

• It is legally recognised.

• There is no role of personal judgement.

Accounting convections

• These are customs/practices which are accepted by accounting bodies, adopted by firms and act as guide in preparation of final accounts.

• These are methods/procedure.

• These are set by common accounting practices.

• Its main concern is preparation of financial statement.

• Biasness is possible here.

• There is no legal recognition.

• Personal judgment plays an important role.