AS-1 or Accounting Standard 1 deals with the disclosure of accounting policies. It provides guidelines to companies on how to disclose their accounting policies in their financial statements. The standard aims to ensure that financial statements are prepared in a consistent and transparent manner, making it easier for stakeholders to understand the company's financial position.

Not regarded as the fundamental concept

The fundamental concepts that are identified by AS-1 are as follows:

1. The Going Concern Concept: This concept assumes that the company will continue to operate for the foreseeable future and will not be forced to cease operations due to financial difficulties.

2. The Consistency Concept: This concept requires that accounting policies be consistent from one period to the next, ensuring that financial statements are comparable over time.

3. The Prudence Concept: This concept requires companies to be cautious in their accounting estimates, recognizing expenses and liabilities as soon as possible and recognizing revenue only when it is earned.

4. The Materiality Concept: This concept requires companies to disclose information that is material or significant, which would affect a user's decision-making.

However, the Separate Entity Concept is not regarded as the fundamental concept identified by AS-1.

Explanation

The Separate Entity Concept is a basic accounting concept that assumes that a business is separate from its owners. It means that the business's financial transactions and accounts are separate from the personal transactions and accounts of its owners. This concept is important because it allows a company to keep track of its financial transactions and performance separately from its owners.

However, AS-1 does not specifically mention the Separate Entity Concept as one of the fundamental concepts that it identifies. This is because the concept is more basic and fundamental than the other concepts, and it is widely accepted in accounting practice. Therefore, it is not necessary to mention it explicitly in AS-1.

Conclusion

In conclusion, AS-1 identifies the fundamental accounting concepts that companies should follow in their financial reporting. These concepts ensure that financial statements are consistent, transparent, and comparable over time, making it easier for stakeholders to understand a company's financial position. The Separate Entity Concept is a basic accounting concept that is widely accepted in accounting practice but is not explicitly mentioned in AS-1 as a fundamental concept.