Section 17 in The Companies (Accounting Standards) Rules, 2006
17. For this purpose, the major considerations governing the selection and application of accounting policies are :-
a. PrudenceIn view of the uncertainty attached to future events, profits are not anticipated but recognised only when realised though not necessarily in cash. Provision is made for all known liabilities and losses even though the amount cannot be determined with certainty and represents only a best estimate in the light of available information.b. Substance over Formc. MaterialityFinancial statements should disclose all "material" items, i.e. items the knowledge of which might influence the decisions of the user of the financial statement.Disclosure of Accounting Policies
