Which principle would most directly conflict with using different accounting methods from year to year without justification?

• A. Regularity
• B. Permanence of Methods
• C. Sincerity
• D. Conservatism

Answer: (B)

Consistency in applying accounting methods across periods is the central idea here. If you change the method from year to year without a justified reason, financial statements lose comparability, making it hard to tell whether changes in income or asset values reflect actual performance or just a different method. Permanence of Methods (consistency) requires sticking with the same method from period to period unless there’s a valid, disclosed reason to switch, and the impact should be shown in the notes so users can compare apples to apples over time.

Regularity means following applicable rules and procedures; sincerity is about faithful representation of the financial position and results; conservatism guides cautious estimation to avoid overstating assets or income. None of these directly impose the same cross-year consistency requirement that changing methods without justification would violate, which is why the principle of Permanence of Methods best fits the scenario.