Conservatism..
Thursday, October 27th, 2005
Technically in Accounting, CONSERVATISM means when in doubt, choose the solution that will be least likely to overstate assets and income. But it doesn’t mean that net assets or net income BE understated. Unfortunately, it has been interpreted by some to mean just that. When properly applied, it provides reasonable guide in difficult instances: refrain from OVERSTATEMENT of net assets and net income.
When applied to the real world, it means expecting the worst. When something bad happens, you prepare your self to be disappointed. You don’t feel so awful because you anticipated it. But when something good happens, it cheers you up because you expected something bad.
But I didn’t mean anything like one must be pessimistic nor one must stop being optimistic. Do I sound like it bah? Hehehe.. What I want to stress is: STOP BEING ASSUMING! It’ll cause you a lot of trouble. Take it from me! @_@ I had my own share, too.
I admit, most of the times, I am like that! That’s why often times, I’m MISUNDERSTOOD! I demand answers from my WHY and HOW questions from which, sad to say, will again be my basis for the series of questions I’ll soon brag about. (I do hope I don’t bore people to death! @_@) I need reasons, you know! I believe everything has reasons and that GOD has his own reasons why things are just not meant to be! Hahay.. That gets to show how one should really be patient to really get to know me! I am aware, though, that sometimes I get so exasperating because of this. For one way or another, it is sensible naman to be like that! You just need to be stiff about it! Ryt?! Hehehe.. -)i(-