Essay Available:
Pages:
1 page/β275 words
Sources:
2 Sources
Style:
APA
Subject:
Accounting, Finance, SPSS
Type:
Essay
Language:
English (U.S.)
Document:
MS Word
Date:
Total cost:
$ 5.27
Topic:
GAAP and IFRS Difference
Essay Instructions:
First, review the attached guide. Then, in your initial post, choose one of the main differences between generally accepted accounting principles (GAAP) and international financial reporting standards (IFRS) and fully explain the selected difference. In addition, discuss how that difference impacts financial reporting. Lastly, discuss which standard you think is more appropriate to apply to financial accounting and why.
You must include at least one scholarly source in addition to the textbook and the provided guide to support your post. You should also utilize the Financial Accounting Standards Board (FASB) Accounting Standards Codification website to support your discussion.
Essay Sample Content Preview:
GAAP and IFRS Difference
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GAAP and IFRS Difference
Different countries have adopted distinct accounting rules and standards that dictate how their companies should prepare and report their financial statements. The main categories of standards are the General Accepted Accounting Principles (GAAP) and the International Financial Reporting Standards (IFRS), which most companies rely on in their reporting (Hlaciuc et al.,2014). In some countries, it is mandatory to follow either of these standards, while in some, they have no strict guidelines; hence companies can use the method they deem fit. Though different companies use the rules based on their preference, they contain numerous differences that can impact company reporting.
GAAP and IFRS differ significantly based on how they value the company’s inventory. The General Accepted Accounting Principle requires organizations to use either the First-In-First-Out (FIFO) or Last-In-First-Out (LIFO) to come up with inventory valuation at a given period (Lucchese & Carlo,2020). When using the LIFO method, companies consider the last goods or the most recent purchases in the company to be the ones to be sold first. The method can affect a company's performanc...
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