Question

What will be a good abstract paper about Financial Statement regarding GAAP and IFRS?

Answer 1

The standards that govern financial reporting and accounting vary from country to country. Financial analysis uses financial statement data in many profitability and risk measures, so analysts are concerned with how comparable the ratios are when the companies being compared are from different countries with different standards. If a company wants to do their business accurately, it is important for the company to understand the differences between IFRS and GAAP accounting.

GAAP also known as Generally Accepted Accounting Principles, are a collection of commonly-followed accounting rules and standards for financial reporting. The purpose of GAAP is to ensure that financial reporting is transparent and consistent from one organization to another. GAAP must be followed when a company distributes its financial statements outside of the company.

IFRS or International Financial Reporting Standards, are accounting standards issued by the IFRS Foundation and the International Accounting Standards Board (IASB). The purpose of IFRS is to maintain stability and transparency throughout the financial world. IFRS enables the ability to see exactly what has been happening with a company and allows businesses and individual investors to make educated financial decisions.