rules, practices and principles have evolved over a period of time. These rules, practices and principles in accountancy are called as 'Accounting Concepts'. These Accounting Concepts facilitate the comparison of financial statements (showing profits and losses as well as position of assets and liabilities) of the same organisation of different periods and of different organisations for the same period. So these Accounting Concepts are termed as 'foundations' of the book keeping system as a whole across the world.