matching principle

Definition

The principle in business accounting that states that revenues generated during an accounting period should be matched to expenses from that period, in order to capture the cause-and-effect relationship between them. Adherence to this principle produces accounting records that capture meaningful connections between income sources and expenditures.

Use matching principle in a sentence

We did not meet the matching principle and that made me angry cause I had gone out of my way to make sure it matched.

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The matching principle was adhered to by the accounting firm who advised the company on when to recognize their revenue.

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We had been strict followers of the matching principle for some time, so when some in management spoke of a different approach, there was skepticism.

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matching funds matching strategy