GAAP Matching Activity

Matching Principle

Revenues and Expenses must be recorded and tracked over the same period of time

Full Disclosure Principle

Present all outstanding lawsuits or mergers on financial statements

Materiality Principle

Follow all GAAPs unless to do so would be unnecessarily costly or insignificant

Principle of Conservatism

Use estimations that are accurate and always error on the side of caution when asked for values.

Objectivity Principle

Record transactions using source documents and not speculation

Business Entity Concept

Keep personal transactions of the owner(s) separate from those of the business

Revenue Recognition Convention

Revenue should be recorded when earned and not when cash changes hands

Cost Principle

Purchases should not be recorded at suspected value but the amount of money paid for it

Consistency Principle

Always follow the same accounting procedures and state all future changes on financial statements

Continuing Concern Concept

Don’t anticipate transactions or make changes because you anticipate something will happen

Time Period Concept

All fiscal periods should be the same length