Quand une vertu devient un principe comptable: le cas de la prudence au Royaume-Uni

Gregory Heem () and Charles Richard Baker ()
Additional contact information
Gregory Heem: GREDEG - Groupe de Recherche en Droit, Economie et Gestion - UNS - Université Nice Sophia Antipolis (1965 - 2019) - CNRS - Centre National de la Recherche Scientifique - UniCA - Université Côte d'Azur

Post-Print from HAL

Abstract: The prudence principle is one of the pillars of the UK accounting model aimed at avoiding the overstatement of revenues and assets and the understatement of expenses and liabilities. Its main objective is to ensure the reliability of financial statements, by adopting a conservative approach that establishes prudence as a fundamental concept whereby profits are not anticipated, but are recognized in the profit and loss account only when they are realized. Using a historical approach, the aim of this article is to understand the origins of the prudence principle. We show that this principle has its origins in several fields, notably philosophy, business law and taxation. In this article, we first examine the evolution of the concept of prudence in several scientific disciplines, including philosophy, legal theory and economics. We then discuss the importance of prudence to business practice and accounting in 19th-century England. Finally, we show that the definition of this concept has continued to evolve in the Anglo-Saxon world, with the adoption of SSAP 2 in 1971, which imposed "asymmetric prudence" in order to avoid distributing fictitious dividends, then the evolution towards "cautious prudence" with the IASC conceptual framework in 1989, and in the UK with FRS 18 published in 2000. This development reflects a rapprochement with the concept of neutrality advocated by US GAAP.

Keywords: Neutrality; Accounting History; Accounting Theory; Prudence; Neutralité; UK GAAP; US GGAP; Histoire de la comptabilité; Théorie de la comptabilité (search for similar items in EconPapers)
Date: 2025-05-12
References: Add references at CitEc
Citations:

Published in Normes, représentations et comportements, Congrés de l'Association Francophone de Comptabilité (AFC), May 2025, Saint- Malo, France

There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:halshs-05077935

Access Statistics for this paper

More papers in Post-Print from HAL
Bibliographic data for series maintained by CCSD ().