Preface A glance at the accounts of most of Britain's larger companies could lead you to conclude that accounting is a very complex and technical subject. While it can be both of these things, accounting is actually based on an incredibly simple principle that was devised more than 500 years ago and has remained unchanged ever since. The apparent complexity of many companies' accounts results from the rules and terminology that have developed around this fundamental principle to accommodate modern business practices. I believe that, once you really understand the fundamental principle and how it is applied, you will find that the rules and terminology follow logi- cally and easily. This view determines the arrangement of the chapters in Accounts Demystified and it is important, therefore, to read them chronolog- ically. You may, however, omit Chapter 5, which discusses book-keeping jargon, and Chapter 7, which concentrates on more sophisticated areas of accounting, without losing the thread of the book.