Convergence between GAAP and IFRS

Convergence between GAAP and IFRS Assignment example
Undergraduate
Assignment
Finance & Accounting
Pages 6 (1506 words)
Download 0
Various international bodies have documented accounting standards that need to be followed in preparing books of accounts ranging from balance sheet, to trading profit and loss accounts, to trial balance in order to cash flows among many others. …

Introduction

The US Generally Accepted Accounting Principles is the major accounting standard used in the United States (Walton 45-46). The International Financial Reporting Standard on the other hand is the accounting standard practiced in over 110 countries in the world. U.s. GAAP is mostly considered as a more rule based accounting system, while IFRS is mostly based on principles. It is therefore obvious that the IFRS and the U.S. GAAP do not agree on every issue (IASCF and IASB 80-101). This paper seeks to focus on the convergence between the Generally Accepted Accounting Principles (GAAP) and the International Financial Reporting Standard.
The International Financial Reporting Standard (IFRS) is an independent body in the private sector. It develops and approves International Accounting and Financial Reporting Standards. The International Financial Reporting Standard (IFRS) functions under the International Financial Reporting Foundation oversight. It was formed in 2001 in replacement of the International Accounting Standards Committee. International Financial Reporting Standard, under the constitution of International Financial Reporting Foundation, has a full responsibility for all technical issues of the financial reporting standards such as: preparation and issuing the interpretations of exposure drafts and International Financial Reporting Standards, full discretion in pursuing and developing technical agenda dependent on requirements of consultation with the public and trustees, the issuing and approval of interpretations by the International Financial Reporting Standards Interpretations Committee (IASB 19-21)).
...
Download paper
Not exactly what you need?

Related papers

Compare and Contrast IFRS vs US GAAP
In addition, the US GAAP treatment allows either single step or multiple steps format for income statement captions. According to Epstein (2011), under US GAAP, expenses such as cost of sales and administrative expenses have to be classed by function whereas in IFRS, expenses can be classed by function or nature. According to US GAAP treatment, classification of extraordinary items is permitted…
The SEC's Condorsement" Proposal
In this study, I would discuss about the IASB as well as the FASB and their relationship with each other. I would then evaluate the SEC proposal and express my opinions about the same. IASB & FASB and Their Relationship with Each Other In year 1973, the International Accounting Standards Committee (IASC) was set up for the purpose of maintaining standardization in the accounting principles all…
Events after the Balance Sheet Date. SFAS 165
This standard has also provided some examples of such events which should be or should not be recognized and reported in the financial statements. This article examines objective of SFAS 165 in a detailed manner such that the important paragraphs of the Statement are directly reproduced from the Statement so that actual wordings of the Statements regarding the important points of the Statement can…
The Relevant International Accounting Standard (IASB)
Contingent assets and contingent liabilities are not recognized but disclosed in the financial statement of the company. The main focus and objective of the standard is that the entity recognizes provision in its balance sheet with is the best estimate of the expenditure to settle an obligation at the end of its financial year. This estimate is the amount of cash outflow that the entity is likely…
Revenue recognition : goods and services
The study will comprise the major points of differences in relation to revenue recognition that will be identified under both the accounting practices (i.e. GAAP and IFRS). Analyzing these aspects, the study will ascertain the grounds on which the accounting treatment of the identified issue, i.e. revenue recognition will be different if US GAAP is replaced with the principles of IFRS.…
GAAP VS IFRS
The United States corporations will benefits by converting from GAAP to IFRS. One, IFRS allows extra flexibility than United States GAAP, and because stock option and bonus schemes normally offer managers incentives to enhance earnings, this flexibility will probably be utilized to enhance the income of U.S corporations more frequently than it will be employed to lessen earnings. Two, converting…
impairments of intangible (including goodwill).
Under the USA GAAP principle, the methodology used for the determination of the impairment of long lived assets is based on the two step approach. In the two steps approach, the first step requires test of recoverability. In this test, the comparison of the carrying amount and future amount of discounted cash flows from the using and disposing. In case, the assets are determined to be not…