Conservatism: Reporting income and expenses in an accurate manner and erring towards understatement of net income and asset values

  • Error on the side of understating revenue
  • Error on the side of overstating expense
  • Example: Inventory reported at historical cost or lower


Learn accounting with the free app

Accounting Flashcards

Accounting Flashcards includes a translate button for English, Chinese, and Spanish.

Learn financial accounting using beautifully illustrated flashcards, coordinated lessons, and rich audio. Whether you are an aspiring CPA or IFRS expert, use this accountancy app to reach your goals. Even an aspiring chartered accountant or those reaching for the CPA Australia can benefit. Topics of accounting standards, equation, terms, ratios, and more are covered.


Get the PDF book here



« Back to Glossary Index