The basic accounting principles are accepted and used by accountants all over the world. 

Some principles are as follows: 

1. Business Entity Concept: According to this concept, a business firm is treated as a unit, separate and distinct from its owners. A completely separate set of books is kept for the firm and business transactions are recorded from the firm’s point of view. Thus the capital provided by the owner is treated as a liability of the firm. Interest on capital is treated as an expense of business. Similarly money/goods drawn by the owner are treated as drawings. 

2. The Going Concern Concept: It is assumed that the business will continue to exist for a long time in the future. Transactions are recorded on the assumption that the business will exist for an indefinite period of time. It is on this assumption that a distinction is made between capital expenditure and revenue expenditure. Fixed assets are recorded at their original cost less depreciation. Market value of fixed assets is not recorded, as these assets are not to be sold in the near future.