What is the definition of accounting theory?

Accounting theory is a set of assumptions, frameworks, and principles that guide the practice of accounting. It seeks to explain and predict the behavior of accounting systems and practices, as well as provide a basis for understanding and evaluating accounting information. The main goal of accounting theory is to provide a conceptual framework for how accounting information is prepared, presented, and used by stakeholders such as investors, creditors, and regulators. It helps to standardize accounting practices and ensure that financial statements are prepared in a consistent and reliable manner.

This mind map was published on 27 September 2024 and has been viewed 31 times.