Essay on Ifrs vs. Gaap

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Within the accounting profession, there have been challenges to develop a set of standards that are generally accepted and universally practiced. Thus far, the main debate in setting accounting standards is “Whose rules should we play by, and what should they be?” While the answer is unclear, users of financial statements and reporting must find methods that has an universal objective, that allows “Grapes for Grapes” 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.…show more content…
U.S companies that are abroad overseas are still authorized to use GAAP, and foreign companies that are listed on U.S. exchanges are authorize to use IGAAP. Advantages with the adoption of IGAAP it would make it feasible for comparisons for the U.S and foreign countries as well as U.S companies to raise capital in foreign markets. But as of now there are still forms of differences. Income earned by common stock is called Earnings per Share (EPS). U.S GAAP accounting for EPS is with more details on the computational guidance on calculations similar to IFRS accounting for EPS which is calculations of year to date that varies. When reporting basic and diluted EPS, U.S GAAP includes continuing operations, discontinued operations, extraordinary items, cumulative effect of change in accounting and net income in contrast to IFRS EPS only including continuing operations and net income. Also, for interim reporting IFRS uses treasury stock

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