Question

Accounting records should be adequately supported by evidence. Identify the concept mentioned here

Answer 1

ANSWER :

Accounting records should be adequately supported by evidence.

➢ The Objectivity Concept is mentioned here.

• The Objectivity Concept states that accounting should be definite, verifiable as well as reliable.

• According to the Objectivity Concept, accounting should be free from personal bias of the persons engaged in the process of recording and presenting accounting data.

• The Objectivity Concept proposes that every accounting entry in the books of accounts should be verifiable against evidences such as vouchers, cash memos, cheques etc.

• As per the Objectivity Concept, all the accounting works must be done on objectives and factual basis.

• In the producing reliable accounting information, accountants should prefer objective (i.e, neutral and verifiable) means of measuring the effects of events rather than those that are subjective (i.e, based on personal feelings and prejudices)