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.

Updated on: 25-Jul-2020


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