Question

Anticipate no profit but provide for all possible
losses

Answer 1

Answer:

Conservatism convention of accounting is a guideline for recording business transactions that is based on the principle: 'Anticipate no profit, but provide for all possible losses. In other words, a business must record expenses and liabilities as soon as it sees an uncertainty of incurring a loss or liability.

Answer 2

Answer:

The concept of conservatism requires that profits should not to be recorded until realised but all losses, even those which may have a remote possibility, are to be provided in the books of accounts.