Basic Accounting Concepts & Business Structures GAAP or the “generally accepted accounting principles” are a set of standards that are accepted and practiced within the financial community. In order to fully understand the generally accepted accounting principles (GAAP) we must first look at the sources that the principles originated from. Historically, there are four organizations that have contributed to the development of the GAAP in the United States. They are the SEC (Securities and Exchange
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10/1/2013 The accounting profession is on the verge of one of the most significant changes since the 1930s. In the very near future there is a great possibility that the United States Generally Accepted Accounting Principles (GAAP), as it is known today, will be replaced by the global standards known as the International Financial Reporting Standards. This paper will provide a history of IFRS and discuss the time frame of the conversion, along with is effects on U.S in the accounting perspective.
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1. Describe what accounting convergence means and assess the likelihood of the convergence being completed and implemented in the next five (5) years? Accounting convergence is a process or goal to establish one set of accounting standards that can be used internationally by attempting to eliminate the differences in the International Financial Reporting Standards (IFRS) and the US Generally Accepted Accounting Principles (US GAAP). Convergence also seeks to establish understandability amongst
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A friend of your says, “I understand there are ‘rules’ for financial reporting. But what are these rules, where can a person find them, and which ones are more important?” One of the most common rules for financial reporting is GAAP, which is Generally Accepted Accounting Principles. GAAP are and is a combination of authoritative standards and simply the common accepted ways of recording and reporting accounting information from companies. GAAP can be found and imposed by companies so that
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“Codification” means the FASB Accounting Standards Codification electronic research system developed and released by the FASB which houses, reorganizes and indexes United States financial accounting standards and related literature (FASB Accounting Standards Codification®). The codification can basically be referred to as a one stop complete authorized source of reference for GAAP framework in order to adhere to the requirements of fair financial reporting by non-governmental entities. The codification
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Financial Reporting Timeline The creation of: 1. Committee on Accounting Procedures Role - With the recent increase in members, the SEC delegated the responsibility of issuing pronouncements on accounting principles to the Committee. The SEC worked with the Committee on Accounting Procedures to develop standards for accounting and financial reporting and issued 51 Accounting Research Bulletins (ARBs) over its lifetime. In 1949, they updated 42 of their original ARBs and codified them.
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first accounting issue associated with Runway Discount’s Refer-a-Friend program is identifying how the $25 referral credit should be recorded in Runway’s income statement. Is this consideration an adjustment of the selling prices of the vendor’s products or services, and therefore characterized as a reduction of revenue, or is it a cost incurred by the vendor for assets and services received from the customer, and therefore characterized as a cost or expense? The next significant accounting issue
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MEMORANDUM TO: Accounting Staff FROM: Junior Accountant DATE: September 23, 2013 SUBJECT: Replacement of SAS 112 with SAS 115 The American Institute of CPAs (AICPA) Statement on Auditing Standards (SAS) Number 115 supersedes SAS Number 112. Going forward, auditors are to use rule SAS 115 when performing internal control audits. The rules have some similarities. However, the key differences in the rules are the definitions for control deficiency, significant deficiency, and
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ACC/460 The Governmental Accounting Standards Board and the Financial Accounting Standards Boards were put in place to assist in regulating the private sector, federal, and state and local governments. These regulations that are in place are to hold he sector accountable for its accurate financial reporting and documentation. I ask how these two divisions differ in its objectives and how to they regulate each party it governs. The Governmental Accounting Standards Board oversees the federal
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the convergence project, between the International Accounting Standards Board (IASB) and the Financial Accounting Standards Board (FASB) (FASB, 2002). This paper will also provide a brief history of the relationships between the two boards, and the equivalents between IASB and FASB. Along with an explanation of how the Master of Science in Accountancy Program helps prepare students for a professional life, within the accounting vocation. Accounting Standards Boards Within each country, there are
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