What does full disclosure concept mean in accounting?

Asked by Topperlearning User | 9th Jun, 2016, 12:29: PM

Expert Answer:

As per full disclosure concept, all material and relavant facts of financial performance of an enterprise must be fully disclosed in a financial statement. This financial statement is the means of communicating financial information to different users to take financial decisions. The Profit and Loss A/c and balance sheet needs to be compulsorily adhered to the format provided by Companies Act 1956, for the preparation of financial statement. This disclosed information should be relevant, reliable.  comparable and understood by all the users. 

Answered by  | 9th Jun, 2016, 02:29: PM