There are general rules and concepts that govern the field of accounting. These general rules, known as basic accounting principles and guidelines, form the foundation on which more in-depth, complex and legalized accounting rules are based. The Financial Accounting Standards Board (FASB) uses basic accounting principles and guidelines as the basis for its comprehensive and comprehensive set of accounting rules and standards. GAAP is exceptionally useful because it attempts to regulate and normalize accounting definitions, assumptions, and methods. Based on generally accepted accounting principles, it can be assumed that there is uniformity from year to year in the methods used to prepare a company's financial statements. And while variations may exist, realistically reliable conclusions can be drawn when comparing one company to another or when comparing a company's financial statistics to statistics for the industry as a whole. Over the years, generally accepted accounting principles have become more nuanced as financial transactions have become more complex (Accounting Principles, 2011). One theory used in accounting is that of conservatism. This notion states that all liabilities should be accounted for even if there is a possibility that they will never occur. The same principle applies to liabilities but not to revenues. The only revenues that can be accounted for are those that have already occurred. Any liabilities that may arise should be recorded, and for the highest amount possible. For example, if a company is sued for any reason and the legal department determines that the possible liability to pay claims will be somewhat… middle of paper… things are supposed to get done. In my research I hope to use these theories and principles to develop new ways of doing things so that the entire accounting field can benefit. But to do this I need to be aware of what the rules are and how they are applied so that whatever I discover will definitely adhere to already accepted principles. To advance a field and develop new concepts it is vital that we understand what has already been proposed and looked at in the past. This is why understanding the theories and principles already in place is so important. There's no point in trying to reinvent the wheel if you don't actually have to. A good researcher should be able to build on what has already been done to advance thinking within the discipline. This is what I hope to be able to do with my research.