prudence concept點解

rjfu2000 你都唔係答緊人地條問題,, 只係在解釋咩叫prudence =~=
Prudence Concept
In case of doubts,accountants should choose a treatment which minimises the reported figure of profit and asset valuation ,or maximises the reported figure of loss and liability valuation.
( 以穩健保守的方法去做account , 目的整細個profit ..最細為最好..因為有d 數係accountants估計.不是真實e,g provision for bad debts)

Examples:
1.The adoptionof the lower of cost or market value in the valuation of stock .
2.Provision for bad debts should be made by estimation.

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Prudence Convention