Selection of appropriate accounting policies is not based on the amount involved. The amount involved refers to the monetary value of a transaction or event. While the amount involved may have an impact on the financial statements, it is not the sole determining factor in selecting accounting policies.

Prudence:
One of the fundamental principles of accounting is prudence, which requires accountants to exercise caution when making estimates and judgments. Prudence means that when faced with uncertainty, accountants should choose the option that results in the least optimistic outcome. This principle helps to ensure that assets and income are not overstated and liabilities and expenses are not understated. It promotes conservatism in financial reporting.

Substance over form:
Accounting policies should be selected based on the substance of the transaction or event rather than its legal or formal aspects. Substance over form means that the economic reality of a transaction should be reflected in the financial statements, even if the legal form suggests otherwise. This principle helps to prevent manipulation or misrepresentation of financial information.

Materiality:
Accounting policies should take into account the concept of materiality. Materiality refers to the relevance or significance of an item or event to the financial statements. If an item is material, it has the potential to influence the economic decisions of users of the financial statements. Therefore, accounting policies should be chosen to ensure that material items are properly recognized, measured, and disclosed.

Explanation of the correct answer:
The correct answer is option 'C' - Amount involved. The amount involved is not a determinant for selecting accounting policies. While the amount of a transaction or event may have implications for the financial statements, it does not dictate the choice of accounting policy. Instead, accounting policies should be based on principles such as prudence, substance over form, and materiality, which help to ensure the reliability, relevance, and transparency of financial reporting.