Matching Principle
/ˈmætʃɪŋ ˈprɪnsəpəl/
Definitions
- (n.) An accounting guideline requiring expenses to be recorded in the same period as the revenues they helped generate.
The matching principle ensures accurate profit calculation by aligning costs with related income.
Forms
- matching principle
Related terms
See also
Commentary
Important in financial reporting to accurately measure profitability over specific periods, avoiding misstatements caused by timing differences between income and expense recognition.
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