GAAP stands for generally accepted accounting principles, which set the standard rules for financial reporting in the U.S. Learn how GAAP works, why it is important, and how it differs from IFRS, the international standard. In today’s business environment, there exists the need for presenting financial information to external users such as the government, banks, stock exchanges and revenue departments. This leads to the requirement of an accounting framework that is helpful in recording business transactions and also assists in comparing financial statements. GAAP was created with the purpose of fulfilling such requirements. What is GAAP? Generally Accepted Accounting Principles or GAAP is a defined set of ... GAAP stands for Generally Accepted Accounting Principles, the standards that guide how financial statements are prepared and presented. Learn about the objectives, principles, and qualities of GAAP for different types of organizations. The Generally Accepted Accounting Principles (GAAP) [a] are the set of default accounting standards used by companies based in the United States. Published and maintained by the Financial Accounting Standards Board (FASB), the Accounting Standards Codification outlines the specific and authoritative rules governing GAAP for non-governmental organisations. GAAP sources of law for government agencies and Securities and Exchange Commission (SEC) registrants are found in federal securities law ...
