what is the difference between conservative and aggressive accounting 
conservative accounting uses accounting policies that result in a lower revenue and or a higher expense on the other hand aggressive accounting uses policies that tend to increase revenue and or reduce expenses a company using conservative accounting policies will have lower earnings in the current year while a company using aggressive accounting policies will show better financial performance in the current year conservative accounting policies will tend toward better financial performance in the long run while aggressive accounting policies tend to lead to a decline in financial performance over the long run the bottom lineaccounting policies are different from accounting principles which are the accounting rules to which all accounting policies must conform a company s management team can choose specific accounting policies that are advantageous to the firm s financial reporting the team might use either conservative or aggressive accounting policies which will determine how a company s financial performance appears in a given year 