Analysis of IFRS and U.S. GAAP GAAP or acronym for Generally Accepted Accounting Principles refers to the standard framework of guidelines for financial accounting used in any given jurisdiction. It is a common set of accounting principles, standards, and procedures that companies use to compile their financial statements (Investopedia). For many years, countries have developed their own accounting standards. The U.S. has always followed the U.S. GAAP while most European countries followed the
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At present, financial accounting standards are established and propagated on the basis of two key conceptual structures, namely, Financial Accounting Standards Board (FASB) and International Accounting Standards Boards (IASB) (Cong 2013). This essay will discuss and justify that accounting theory played a role in setting of accounting practices but it played no significant role in setting of accounting standards. Rather, several accounting standards were set by the conceptual frameworks formulated
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Accounting I The Financial Accounting Standards Board (FASB) was established in 1973 in order to create and develop standards of financial accounting and reporting for the general use of the public and, in particular, users of financial information including auditors, creditors and investors. This financial information is standardized for greater clarity for the guidance and education of users (FASB org, 2009a). The primary purpose of FASB as a private and non-profit organization is to develop Generally
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CHAPTER 1 ENVIRONMENT AND THEORETICAL STRUCTURE OF FINANCIAL ACCOUNTING Overview The primary function of financial accounting is to provide useful financial information to users external to the business enterprise. The focus of financial accounting is on the information needs of investors and creditors. These users make critical resource allocation decisions that affect the nation’s economy. The primary means of conveying financial information to investors, creditors, and other external users
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(American Institute of Certified Public Accounts) as laid out by the regulations set by the Securities and Exchange Commission (SEC). In 1973, the Financial Accounting Standards Board (FASB) was developed by the AICPA as a council for establishing standards for reporting for all United States companies. Under FASB, GAAP was reorganized into approximately 90 accounting standards offering concise methods to follow for financial reporting. This not only allowed for ease of access when reading US financials
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The road to international reporting The Convergence of GAAP and IFRS | Leroy Meadows Advanced Accounting | The road to international reporting The Convergence of GAAP and IFRS | Leroy Meadows Advanced Accounting | The Road to International Reporting The convergence of a rules-based approach and a principles-based approach in relation to accounting and the dissemination of financial information is not something to be taken lightly. With the need for convergence increasing due to globalization
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the International Accounting Standards Board (IASB). Therefore the accounting standards in different countries are not identical but very similar from one to another which allows convergence of accounting practices. However, standardisation of accounting has the direct opposite meaning of harmonisation where the standardisation requires all accounting practices in various countries to be exactly the same. Harmonisation tends to be associated with IASB which carries out the process of coordination
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A Comparison and Contrast Analysis of United States Generally Accepted Accounting Principles (GAAP) and International Financial Reporting Standards (IFRS) This paper examined the relationship between United States Generally Accepted Accounting Principles (GAAP) and International Financial Reporting Standards (IFRS) and found merging both accounting standards into a worldwide standard is ideal for investors. Corporate financial statement requirements depend on location. The two accepted accounting
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Finance Assignment Names: ABRAR MOHAMMAD MAHA MOHAMMAD Student I.D.’s: 7611, 7422 Class: C-17 Course Title: Principles of Finance Course Code: FIN211 Introduction Financial Statement: It is a formal record of the financial activities of a business, person, or other entity. In British English—including United Kingdom company law—a financial statement is often referred to as an account, although the term financial statement is also used, particularly by accountants
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Both the International Accounting Standards Board (IASB and the Financial Accounting Standards Board (FASB) provide oversight for Generally Acceptable Accounting Principles (GAAP) and the International Financial Reporting Standards (IFRS). Both the FASB and the IASB have been working together to bring more of a uniform set of regulations between the two standards. GAAP has tradionally always provided the guidelines that companies in the United States follow when putting their financial
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