Accounting policies are set of procedures adopted by a company for the application of accounting principles to prepare its financial statements. Accounting policies are different from accounting principles. Every company has its own set of accounting polices based on its business environment. Two companies may treat same item in different manner due to different accounting policies.
e.g. : A company may choose to depreciate its assets as per straight line method while another may use written down value method. Similarly, for inventory valuation a company may use FIFO or weighted average.