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What is meant by Concept of Conservatism?

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Question ajoutée par Muhammad Arif , Senior Officer Business Monitoring , Allied Bank Limited
Date de publication: 2017/03/07
Abdullah Aziz Eldain Morsi  Elgendy -        CMA  Candidate
par Abdullah Aziz Eldain Morsi Elgendy - CMA Candidate , Regional Receivable Accountant , Amiantit Group of Companies

Accounting conservatism is a branch of accounting that requires a high degree of verification before making a legal claim to any profit as it requires recognition of all probable losses as they are discovered and most expenditures as they are incurred. Revenue will be deferred until it is verified as strict revenue-recognition criteria is one of the most common forms of accounting conservatism.

manseer muhammed ali
par manseer muhammed ali , Accountant General , Royal Lighting L.L.C & Royal Furnishing LLC

it is the general concept of recognizing expenses and liabilities as soon as possible when there is uncertainty about the outcome, but to only recognize revenues and assets when they are assured of being received. ... The conservatism principle can also be applied to recognizing estimates.

Muhammad Kassab  CPA CMA CertIFR
par Muhammad Kassab CPA CMA CertIFR , Accounting Manager , Marine Buildings Landmarks

in cases of Uncertainty, Conservatism principle recognizes loss as soon as it is probable to happen and can be estimated (even if it will happen in a later period), but only recognizes gain when it is actually gained or happened.

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