Ans. conventions are notstrict rules but these are guidlines .
main convention of accounting
- convention of disclosure
according to this convention ,''business man show full information in his profit and loss account and balance sheet . He does not misguide by not giving information in his final account . He must disclosure all correct information not only in final account but all statements prepared by him.
2.convention of consistency
according to this convention ,''the rules , regulation , system & method of maintainging accounts must be consistt . it is because , it helps to comparison and result from information.
3. conventionn of conservatism
according to this convention ,'' anticipate all future loss and create reserve for them . but do not provide any estimation for future profit.
4. convention of materiality
convention of materiality is very good convention , it guides us that accountant should record only useful and valuable transaction and event . He must be avoid or ignor all unvaluable or useless transaction or event so that cost of recording will be minimize
