Reply To: Prudence Principal

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August 9, 2019 at 7:23 pm #24782
Rishabh Surana
Moderator

    arya3340 wrote:

    Anyone aware about prudence principal in calculating reserves.

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    It is a conservatism principle where companies tend to understate assets & income & overstate future liabilities & expenses which help them to play safe.

    It helps them in carrying out Reserving accordingly in order to reduce their financial risk.

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