There is a lot going on in the US accounting world at this time. Businesses are trying to gear up for the changes that are happening to their books. IFRS and US GAAP are in the process of convergence so businesses can be on the same page when conducting business globally. There are more similarities than differences between IFRS and US GAAP when you compare the presentation of their financial statements (US GAAP versus, 2015). This paper will take a look at the similarities and differences of the
Differences of GAAP and IFRS Haotian Guo In 2014, a study from PricewaterhouseCoopers pointed that American investors are looking over-seas’ capital market for investment opportunities, and foreign investors are also looking for investing opportunities in America. According to the research from PricewaterhouseCoopers in 2014, an estimates shows that there are around seven trillion US dollars are invested in foreign stock markets, and American markets are open to non-US firms too.
‘US GAAP’ is the term used to indicate the body of authoritative literature that comprises accounting and reporting standards in the US. Rules and interpretative releases of the SEC under authority of federal securities laws are also sources of authoritative GAAP for SEC registrants. Authoritative US GAAP is primarily developed and maintained by the FASB and the Emerging Issues Task Force. Unlike IFRS, US GAAP is designed for use by both profit-oriented and not-for-profit entities, with additional
IFRS in the US and the World Political and economic forces shape accounting. The increased worldwide integration of politics and markets raises the necessity for integration of financial reporting standards. The integration is driven by the reductions in the costs of information processing and communication. International Financial Reporting Standards are a common business affair language in the globe for easier comprehension and comparison of company accounts across international boundaries (AICPA)
comparisons that clearly, fairly, and completely prepares a company financial statements. For years GAAP has been the common set of standards and procedures for the U.S, the core for establishing a principle of reporting but now IFRS an international friendly financial reporting system has become popular for its use globally.
There are vast and numerous differences between US GAAP and IFRS. The biggest conceptual difference between US GAAP and IFRS is that US GAAP is rule based while IFRS is principle based. Because of this, there are numerous accounting topics that are handled differently between US GAAP and IFRS. It is argued that IFRS fits the actual economics of business transactions more than US GAAP, as IFRS looks more at the substance of transactions. US GAAP, on the other hand, is more concerned with having exact
Topic: The effects of GAAP and IFRS Convergence on accounting programs The first article reviewed was A progress report: IFRS-U.S. GAAP Convergence and it Curriculum Impact. The key aspect of this abstract is the impact in higher education. The difficulties in training for teaching IFRS and the benefits gained. The introduction describes how more countries have adapted the IFRS guidelines and it estimates that the United States may do so in the next decade. Because IFRS is becoming widely accepted
Practice (GAAP) has been in place for a long period of time and was harmonized in 2005 so as to comply with the international accounting standards. The UK embraced the principles of the International Financial Reporting Standards (IFRS) in 2005 after the European Union (EU) mandated that all members that were publicly listed companies be subject to reporting under the International Accounting Standards (IAS). This was to help facilitate that those listed companies could easily be compared to onr other
discrepancies between IFRS and GAAP Kaci Amon, Poonam Aujla, Daniel Aurora, Yuanyan Fang, Mark Gonzalez Accounting 306 C1 Professor Xuhong Luo August 12, 2012 Executive Summary The generally accepted accounting principal (GAAP) and international financial reporting standard (IFRS) are standards governing how economic events are reported. In the United States, the Securities and Exchange Commission (SEC) relies on the FASB, the accounting standard-setting body of the US, to develop accounting