conservation Prudence concept: revenue and profits are included in the balance sheet only when they are realized(or there is reasonable ’certainty ’ of realizing them) butliabilities are included when there is a reasonable ’possibility ’ of incurring them. Also called conservation concept. Du Pont analysis A type of analysis that examines a company ’s Return on Equity (ROE) by breaking it into three main components:profit margin‚ asset turnover and leverage factor. By breaking the ROE into
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Application of Accounting Concepts Matching Principle & Accrual Concept Accrued / Prepaid Expense & Accrued or Advance Revenue To ensure an accurate matching of expenses and revenue under the accrual basis‚ it is necessary to include all revenue earned but not received and expenses incurred but not paid. Such adjustments comprise adjustments for : Accrued Revenue Accrued Expenses On the other hand‚ many recorded costs and revenues benefit more than one accounting period. Therefore‚ adjusting
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The prudence concept Being prudent means THAT YOU ARE CAREFUL ABOUT YOUR FINANCIAL SITUATION. IT MEANS NOT BEING CERTAIN ABOUT HAVING MONEY UNTIL YOU DEFINATLY KNOW YOU WILL BE GETTING IT. The prudence concept means that when you are running a business and trying to figure out what your profits will be you understate your profits rather than overstate them. It also means that you make a record of all the debts or money that you own out of the business and not writing down any anticipated profits
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Is Prudence a Special Virtue? Prudence is “right reason applied to action” (Purple Book‚ p. 99). More clearly‚ prudence is one’s ability to evaluate and act on a situation by the use of practical reason. There are three acts that define prudence: to take counsel‚ to judge‚ and to command. One takes counsel when he discovers the situation. One must then judge and evaluate the discovery using reason. Finally‚ a command or decision is made based on the counseled and judged. The display of prudence
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The Concept of Prudence: dead or alive? FEE Conference on Corporate Reporting of the Future‚ Brussels‚ Belgium‚ Tuesday 18 September 2012 Hans Hoogervorst‚ Chairman of the IASB ______________________________________________________________ Ladies and gentlemen‚ I am grateful to the Federation of European Accountants for the opportunity to participate in today’s conference. As has often been said‚ Europe kickstarted the move towards global accounting standards when it and others adopted IFRSs
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Plato Truth and Reality- "And isn’t it a bad thing to be deceived about the truth‚ and a good thing to know what the truth is? For I assume that by knowing the truth you mean knowing things as they really are. " Truthfulness. He will never willingly tolerate an untruth‚ but will hate it as much as he loves truth... And is there anything more closely connected with wisdom than truth? (Plato‚ 380BC) Reason Reason is knowledge of things like mathematics but which require that some postulates
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Aristotle – Nicomachean Ethics Book I 1. What does it mean to say Aristotle’s ethical theory is “teleological?” In Aristotle’s world‚ nature‚ which is made up of matter and form‚ is teleological‚ meaning it has an end or goal. For example‚ the telos of an acorn is to turn into an oak tree. At first something has its potential and then it makes the choice in life to actualize that potential‚ by virtue‚ and be the best it can be. There is an aim and purpose to everything and a purpose to everything
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Cardinal Virtues? (Give a definition of cardinal and each of the virtues)? Cardinal virtues are virtues which are common to all people‚ Christian or not. It is derived from a Latin word meaning ‘the hinge of a door’ because they are pivotal d. Prudence – practical common sense; harmless as doves but also as wise as serpents e. Temperance – putting a limit to one’s “addictions” f. Justice – “fairness” g. Fortitude – 2 kinds of courage‚ faces danger and sticks it under pain; guts
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the apostle again. It was his strong will that led him to the right track. Without the fortitude‚ people cannot practice any other virtue very long without bringing this into play. Sonny set a nice example of these two virtues for Christians. Prudence is practical common sense‚ taking the trouble to think out what you are doing and what is likely to come of it. If we look inside the film‚ it is easy to find out that Sonny violated this virtue at first. His wife had been seeing a
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requires great fortitude and remarkable character. Leaders are not born‚ they are made and character is built on virtuous decision making and action. Learning to be a great leader requires the development of the seven virtues: courage‚ hope‚ justice‚ prudence‚ temperance‚ love‚ and faith. We will explore how these virtues apply to the challenges identified and how they will assist in guiding towards a solution while remaining moral‚ ethical‚ and responsible leaders. One issue that business leaders face
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