According to this concept, every transaction or event has two aspects i.e dual effect. This concept recognises that for every debit, there is a corresponding and equal credit. This is the basis of the entire system of double entry book-keeping.

This concept implies that a business unit is separate and distinct from the owner or owners, that is the person who supply capital to it. Based on this concept, accounts are prepared from the point of view of, the business and not from the owner's point of view.

i) Convention of consistency
ii) Convention of full disclosure
iii) Convention of materiality
iv) Convention of conservatism or providence.

(i) The Consistency convention implies that the Accounting practice should remain the same from one year to another.
(ii) The results of different years will be comparable only when same accounting methods are followed from year to year.
(iii) The firm should be modify the method of charging the depreciation from one to another.
(iv) If any change has to be incorporated, valid reasons for such a change should be emphasised.

(i) The accounts must disclose all material information.
(ii) The Accounting reports should disclose full and fair information to the related parties.
(iii) The financial position and performance should be disclosed very honestly to all the users.

Yes, principle of conservatism has two effects.
(I) Profit and loss account discloses lower profit in comparison to the actual profits.
(ii) Balance sheet will disclose understatement of assets and overstatement of liabilities.

The need for accounting standards is as follows:
1. To Promote better understanding of financial statements.
2. To help accountants to follow uniform policies and practices.
3. To facilitate meaningful comparison of financial statements of two or more entities.
4. To enhance reliability of financial statements.
5. To meet the legal requirements effectively.

Process of Accounting cycle

(i) When a businessman starts his business activities, he records the day-to-day transactions in the journal.
(ii) From the journal the transactions move further to the ledger where accounts are written up.
(iii) Preparation of trading and profit and loss account is the next step.
(iv) The balancing of profit and loss account gives the net result of the business transactions.
(v) Thus this cyclic movement of the transactions through the books of accounts (accounting cycle) is a continuous process.

The following are the basic concepts of accounting :
(i) Business entity concept
(ii) Money measurement concept
(iii) Going concern concept
(iv) Cost concept
(v) Dual aspect concept
(vi) Accounting period concept
(vii) Matching concept
(viii) Realisation concept
(ix) verifiable and objective evidence concept
(x) Accrual concept.

(i) International Financial Reporting Standards are issued by the International Accounting Standard Board (IASB).
(ii) IFRS is a set of International Accounting Standards stating how particular types of transactions and other events should be reported in financial statements.
(iii) IASB initially adopted the Accounting standards issued by IASC to be replaced by IFRS upon their issuance.
(iv) The objective behind setting up the IASC and later IASB was to develop Accounting Standards that would be acceptable worldwide and to improve financial reporting internationally

(i) Accounting Conventions:
1. The word convention refers to traditions or customs. The accounting convention describes the customs or traditions followed as a guide to the preparation of accounting statements.
2. Modern business world has accepted the utility of these Accounting conventions in making financial statements more realistic, reliable, and useful to all concerned parties. The following four conventions are generally adopted over a period of time.
(ii) Convention of consistency:
1. The consistency convention implies that the Accounting practice should remain the same from one year to another. The results of different years will be comparable only when same accounting methods are followed from year to year.
2. For Example: If a firm follows the original or fixed installment method of charging depreciation since its purchase/construction, the method should be followed without any change.
(iii) Convention of full disclosure:
1. The accounts must disclose all material information. The Accounting reports should disclose full and fair information to the related parties. The financial position and performance should be disclosed very honestly to all the users.
2. All the information should be relevant, reliable, comparable and understood by all the concerned authorities.
(iv) Convention of conservatism or prudence:
It is a policy of caution or playing safe. While recording the business transactions one has to anticipate no income but provide for all possible losses.

Book-keeping has the following advantages:
(i) Transactions are recorded systematically in chronological order in the book of accounts. Thus, book-keeping provides a permanent and reliable record for all business transactions.
(ii) Book-keeping is useful to get the financial information.
(iii) It helps to have control over various business activities.
(iv) Records provided by business serve as a legal evidence in case of any dispute.
(v) Comparison of financial information over the years is possible. Also comparison of financial information of different business units is facilitated.
(vi) Book-keeping is useful to find out the tax liability.

Meaning of Book-keeping:
(i) Book-keeping is the process of recording financial transactions in the books of accounts.
(ii) It is the primary stage in the accounting process.
(iii) It includes recording the transactions and classifying the same under proper heads.
(iv) Book-keeping work is of routine nature.
Features of Book-Keeping :
Following are the features of book-keeping :
(i) It is the process of recording transactions in the books of accounts.
(ii) Monetary transactions only are recorded in the accounts.
(iii) Book-keeping is the primary stage in the accounting process.
(iv) Book-keeping includes journalising and ledger processing.