Using this principle, a fact or a happening or event which cannot be expressed in terms of money is not recorded in the accounting books.
Thus, it is not acceptable to record such non-quantifiable items as employee skill levels or the quality of great customer service.
This principle also assumes the unit of measure is stable; that is, changes in its general purchasing power are not considered sufficiently important to require adjustments to the basic financial statements.
The inflation which occurs over the passage of time is not considered.
Only those are consider which can be measured in the term of money or which are financial in nature.