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Business Definition for: accounting convention
Dictionary of Accounting Terms
accounting convention

methods or procedures employed generally by accounting practitioners. They are based on custom and are subject to change as new developments arise. A new accounting or tax requirement, such as an SEC accounting series releases (ASRS) may make a convention inappropriate. The accountant in performing the reporting function should follow existing accounting conventions that apply to the given situation.

See also accounting principles
Related Terms:
accounting principles

rules and guidelines of accounting. They determine such matters as the measurement of assets, the timing of revenue recognition, and the accrual of expenses. The "ground rules" for financial reporting are referred to as Generally Accepted Accounting Principles (GAAP). To be "generally accepted," an accounting principle must have "substantial authoritative support" such as by promulgation of a Financial Accounting Standards Board (FASB) pronouncement. Accounting principles are based on the important objectives of financial reporting. An example of an accounting principle is accrual.

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