Foundations of Financial Accounting and Reporting

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Foundations of Financial Accounting and Reporting

I. Introduction

a. Principles of accounting
Accounting principles are the set of rules and guidelines which are prescribed by different authorities of accounting and these rules and regulations are followed by companies while making and recording all the financial and accounting data or information. At this point of time almost every company in this world tried to follow generally accepted accounting principles which is better known as GAAP. The purpose of accounting principles is to bring equality among the techniques used in recordings and making accounting reports all over the world. This makes accounting reports transparent for all and also makes them easy to understand.

Full Disclosure principle
According to this principle a company needs to show all…