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"Those who enjoy wasting time, enjoy wasting their lives." Shaykh AbdulBary Yahya

Accounting Theories for Life!

Bismillah

accounting theories for lifeFor a successful management, records of accounting are essential. Every credit and debit is recorded and analyzed every year or so. If the statements are financially positive, the management carries its future plans and keeps steps forward in expanding and reaching its goals. If not, the management doesn’t take action in terminating all positions and shut down the company at once, but further analyzes for its development. They research for the loopholes, study the consumers and try to stretch further its wings to fly towards its goals. But poor management will not foresee the shortcomings; rather it would take no more risks but decide to shut down the company.

Some of the theories that a company decides when it keeps accounting records are gain and loss recognition, conservatism and so and so.

Conservatism:
Conservatism is that Transactions should be recorded so that net assets and net income are not overstated. Anticipate losses, but do not anticipate gains.

Gain and Loss Recognition:
Gains are recognized/recorded at the time they are realized. For example, an increase in the value of land cannot be recognized as a gain until the land is actually sold. Losses are recognized when they become apparent. For example, a decrease in the value of inventory would be recognized as a loss when it becomes apparent.

Our lives should be as successfully managed companies, every time the remembrance of our records of good deeds and sins should be analyzed. There will be the One to whom our records will be shown and nothing will go unseen and unheard.

Conservatism in Life:
Anticipate the punishments, don’t ignorantly anticipate the gains. Remembrance of gains in akhira motivates us to walk on straight path, yet don’t assume that everything we do is 100% right. Search for the truth without walking blindly. But remembrance of the fire will surely keep you away from its touch.

‘When you have committed a sin, repent and NEVER repeat. When you are involved in a good deed don’t show it off, better keep it by yourself for the Almighty is all seen.’

Gain and Loss Recognition:
Gains are recognized/recorded at the time they are realized. Likewise, you cannot measure the value of the good deed you did until they are put on the scale on the Day of Judgment. Losses are recognized when they become apparent. When you commit a sin you don’t have to wait until the Day of Judgment, your heart knows whether you committed an unlawful act or not.

Theories of Life are much more complex than the theories of accountancy. Manage life by being proactive instead of leading it to be bankrupt.

Authored by Zaneefa Zaneer ♦ To Read more about the Author CLICK HERE
Edited by Nasmira Firdous ♦ To Read more about the Editor CLICK HERE

Prophet Muhammad - "Convey (knowledge) from me even if it is just one ayah" [Bukhari 3461]

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