Accountancy, asked by daspanna06, 1 month ago

What is a disadvantage of not using the prudence concept?

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Answered by reddiamond1607

1

Answer:

Disadvantages. The prudence concept in accounting doesn't always necessarily consist of correct facts. You cannot apply the prudence concept to cultures that are outside of the IFRS or the GAAP. A company may try to create provisions which are not required that may result in the creation of some secret reserves.

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