Businesses Must Reclaim Prudent Accounting Principles

Beyond its human toll, COVID-19 has wrought upon us a daunting economic toll. In a matter of just two weeks in mid-March 2020, entire industries and sectors were brought to an abrupt halt. To survive a crisis like this, a business must be both efficient and resilient. Prudent accounting — the common-sense accounting concept that there should be a higher threshold to recognizing anticipated gains relative to recognizing anticipated losses — had for generations helped businesses balance these two pulls.

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