Accounting and basic assumptions

In accounting, two statements are prepared for a specific period: the Profit and Loss Account and the Balance Sheet. The Profit and Loss Account shows the profit or loss for a given period, while the Balance Sheet reflects the financial position on a particular date.By reading the title of the article, some readers may get confused. Today, accounting entries are written using computerized systems and advanced technologies such as ERP in most places. Now, cloud services are also being used to store all this information.

In such an extremely advanced scientific environment, a question may also be raised: “Is the topic of ‘Basic Assumptions’ still important?” Against this background, if we consider the fundamental objective of accounting (not its benefits), the seriousness and importance of this subject becomes clear. While doing accounting, we prepare two statements for a specific period. These two statements are: the Profit and Loss Statement prepared for a specific period, and the Balance Sheet as on a specific date...(To continue, open the magazine)