Accounting policies followed by the companies are __________.

Different from year to year

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Frequently changed as per the situation

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The same as notes to accounts

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Consistently followed from year to year

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Solution

The correct option is D Consistently followed from year to year
The accounting information provided by the financial statements would be useful in drawing conclusions regarding the working of an enterprise only when it allows comparisons over a period of time as well as with the working of other enterprises.
Thus, both inter-firm and inter-period comparisons are required to be made. This can be possible only when accounting policies and practices followed by enterprises are uniform and are consistent over the period of time.

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