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The Ten GAAP Principles

IFRS are international standards set by the IASB to ensure financial statements are reliable, clear and comparable across countries. IFRS defines how businesses account for transactions and disclose financial information to provide consistency between companies. US GAAP is a set of principles and standards provided by the FASB that US public companies must follow when preparing their accounts. GAAP aims to improve transparency, accuracy and comparability of financial reporting through a mixture of authoritative standards and documentation procedures. It includes 10 key principles such as regularity, consistency, sincerity and full disclosure.

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61 views1 page

The Ten GAAP Principles

IFRS are international standards set by the IASB to ensure financial statements are reliable, clear and comparable across countries. IFRS defines how businesses account for transactions and disclose financial information to provide consistency between companies. US GAAP is a set of principles and standards provided by the FASB that US public companies must follow when preparing their accounts. GAAP aims to improve transparency, accuracy and comparability of financial reporting through a mixture of authoritative standards and documentation procedures. It includes 10 key principles such as regularity, consistency, sincerity and full disclosure.

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Raj Chauhan
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© © All Rights Reserved
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IFRS- International Financial Reporting Standards (IFRS) set down universal guidelines such

that financial statements across the world can be reliable, straightforward, and comparable.
IFRS is published by the International Committee on Accounting Standards (IASB). They
define how businesses will manage and disclose their accounts, identifying transaction
forms, and other financially affecting events. To provide a popular accounting language, IFRS
has been developed so that companies and their financial statements can be consistent and
accurate from company to company and country to country.

US GAAP- The Generally Accepted Accounting Principles (GAAP) apply to a specific collection
of Accounting Principles, Standards, and Procedures provided by the FASB. Public companies
in the United States must follow GAAP when compiling their accounts. The GAAP is a
mixture of authoritative standards (set by government boards) and generally recognized
forms of documenting and reporting accounting data. The GAAP aims to improve the
transparency, accuracy, and comparability of financial information communications.
The ten GAAP principles

 Principle of Regularity
 Principle of Consistency
 Principle of Sincerity
 Principle of Permanence of Methods
 Principle of Non-Compensation
 Principle of Prudence
 Principle of Continuity
 Principle of Periodicity
 Principle of Materiality or Full Disclosure
 Principle of Utmost Good Faith

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