Debit The Receiver, Credit The Giver This principle is used in the case of personal accounts. When a person gives something to the organization, it becomes an inflow and therefore the person must be credited in the books of accounts. The converse of this is also true, which is why the receiver needs to be… Read More »
Introduction to accounting principles Accounting is an integral part of every business regardless of business size. With modern-day business requirements, business and accounting are simply inseparable. By recording all the financial transactions, accounting helps in determining the financial performance of the business by preparing financial statements. These financial statements are used by both internal stakeholders as… Read More »
In drawing up accounting statements, whether they are external “financial accounts” or internally-focused “management accounts”, a clear objective has to be that the accounts fairly reflect the true “substance” of the business and the results of its operation. The theory of accounting has, therefore, developed the concept of a “true and fair view”. The true… Read More »